The Canadian property-and-casualty sector of the insurance market insures natural-hazard losses to property. During 1999 over $38.7 billion in written premiums were made against controllable assets of over $53 billion (IBC, 1996). On average, during the last five years, over $1 billion in losses per year were caused by natural hazards (EPC, 1996).
Similar to the USA, the costs of natural hazards losses in Canada have been increasing. Tornado losses over the past few years have cost over $300 million on average, flooding in Quebec cost over $1 Billion, while a 1998 ice storm produced losses estimated at $1.6 Billion (adjusted to year 2000). Increased wealth and urbanization are two factors having increased the potential losses arising from natural hazards.
Prior to 1995, the worst year on record for cat losses involved $450 Million in losses. Most experts agree a worst case event would be an earthquake near Vancouver producing losses estimated at $9 to $12 Billion, far surpassing the $2.3 Billion cat capacity available in the Canadian market.
The National Building Code of Canada (NBCC) uses the 10-year, 30-year and 100-year return-period wind pressure. The highest 50-year return period winds (140 kph) are located along the coast of British Columbia and in the eastern provinces, and result from low surface roughness (low friction) associated with water surfaces (Etkin and Maarouf, 1995). Cumulatively, strong wind events cause the most insurance losses in Canada (Davenport, 1994) and can be caused by tornadoes, tropical cyclones, extra-tropical cyclones, downburst and microbursts, gust fronts of thunderstorms, and general atmospheric turbulence. In earthquake-prone regions of Canada, the best building codes were accepted in 1985 and post 1994 construction. Regulation and actual practices vary by region. In any event, the threat from ensuing fires is often overlooked in building codes.
Changing demographics place more and more insurable equity near the population centers along the West Coast of Canada. This is where the greatest potential for loss, (up to an 9.0 earthquake - ?), exists in Canada.
Canadian CRESTA Accumulation Zone Map
The greatest losses on the east Coast come from wind, freeze, and flooding. Although not as great as a potential EQ loss, these perils are more frequent and costly to the insurance industry.
The Prairie region of Canada is also subject to natural hazards however the loss there is not as severe as at either coast due to limited population densities.
During the last 100 years, there have been eight events of magnitude 7 or 8 in Canada. Canada has a long history with earthquakes in seismic areas where much of its present population now lives. The map following shows these risk zones which occur in four principal areas: the west coast in a continuous belt from Vancouver and Victoria north to southern Yukon Territory, the Mackenzie Valley of the Northwest Territories, the eastern Arctic Islands and in southeastern Canada - Ottawa, St. Lawrence valleys, and offshore south of the island of Newfoundland.
Earthquakes along the West Coast are caused by the interaction of the North American and Pacific Plates which slide along each other at a rate of 2-3 inches per year. Further south, the Juan de Fuca plate is thrust subducting beneath the continent. This type of seismicity is capable of producing large magnitude events. The largest historical earthquake (witnessed and documented by civilization) in this region occurred on January 26, 1700. The 1700 earthquake was estimated to be a Magnitude 9 and in addition to the tremendous shaking, it produced a great Tsunami that caused destruction as far away as Japan.
The other area of Canadian seismicity exposing tremendous amounts of insurable equity is situated within a continental plate. In this region, along the St Lawrence Valley, seismicity is believed to be caused by internal plate pressure caused by the expanding forces of the Mid-Atlantic Ridge pushing the North American plate westward. This pressure reactivates old zones of weakness causing them to readjust.
The National Research Council (NRC) makes its recommendations about the National Building Code of Canada (NBCC) nevertheless construction standards rest with the provinces. Saskatchewan, Quebec, New Brunswick, and Nova Scotia have adopted the 1990 National Building Code with the remaining provinces doing so in 1994. However, municipal enforcement is uneven and there is a lack of knowledge concerning the different primary and secondary hazards associated with various regions.
The age of the building stock must also be considered. Most buildings built before 1994 are not up to code. It is estimated that only half of those built between 1960 and 1990 are capable of surviving an earthquake. Buildings built before 1941 are fully susceptible.
The threat of conflagration by ensuing fire is real. This is most evident in highly concentrated areas such as Montreal or in areas having substantial frame constructed building inventories with high wind speeds.
In 1995, the property and casualty sector of the insurance market registered total sales of $17.6 Billion (Canadian) against assets of $41 Billion. On average the Canadian Insurance market pays $1 Billion in losses due to natural hazards. It is estimated that a major earthquake in the Vancouver area would cause at least $9-12 Billion in direct damages. It is also expected that post damage inflation, upgrading damaged buildings to meet new codes, and the number of buildings declared as a constructive total loss due to safety reasons would increase that loss significantly.
Volcano, Tsunami, Landslide, and Sea
Most of Canada's volcanic activity is confined to British Columbia and the Yukon. The hazard posed by volcanic eruption in this area is directly related to the type of materials erupted and the number of structures exposed. While there has been little recent activity, many of the volcanoes in this area are still active. Extreme hazards are associated with composite volcanoes which have violent explosive eruptions and can cause extensive damage of up to many hundreds of square miles.
Volcanic Activity in Western Canada
The major hazard, aside from volcanic lava flow, is the spewing of ash. Ash can be propelled many miles and ranges in size up to that of a house. The risk is to buildings not designed to carry such a load, in addition the plumes can and do affect aviation. Jets flying through plumes will experience engine failure.
Tsunamis are huge ocean waves caused by earthquakes or volcanoes that erupt under water. The waves of the tsunami can move large distances and their speed can reach more than 800 kilometres per hour. In deep waters, tsunamis are less than a yard high. However, when they reach shallow waters or narrow bays, the waves pile up into a tall wall of water which causes devastation to things on shore.
Historical Tsunamis Affecting Canada
In the past century landslides have caused many deaths and have cost billions of dollars in damage. Landslides can occur in all parts of the country, including flatlands as well as mountains. Hazards include the impact of rapidly moving debris, the collapse of ground beneath structures and the secondary effects such as river damming and landslide-generated shock waves.
In the past century landslides have caused many deaths and have cost billions of dollars in damage. Landslides can occur in all parts of the country, including flatlands as well as mountains. Hazards include the impact of rapidly moving debris, the collapse of ground beneath structures and the secondary effects such as river damming and landslide-generated shock waves. Many hazards to shipping, structures, fishing, navigation, and communication exist offshore. Icebergs, fog, tidal surge, and sea ice as well as high winds and seas are capable of causing large losses to Canadian industries.
Tornadoes, Hail Storms, Cyclones, Winter Storms, Floods, and Lightning
Canada is second only to the United States in Tornado frequency. Nevertheless Canada has never experienced an F5 Tornado and most Canadian Tornadoes are under F3. On the above map, each color indicates the number of tornadoes which have historically occurred in an area of 10,000 square kilometers. Northern Canada does not have enough information to accurately estimate Tornado frequency, however considering how tornadoes form it is thought that this area of Canada will have very few tornadoes.
In Canada, more than 70 tornadoes a year strike the populated regions, with most occurring during the months of April through October (June and July the most active). The highest risk of tornadoes is in Southern Ontario followed by south central Alberta, southern Saskatchewan and Manitoba, northeastern Ontario, and western Quebec. Fortunately most Canadian tornadoes are weak (only 9 of F4 have ever been recorded - all in Ontario) and do not cause extensive damage.
However, two recent tornadoes in Ontario and Alberta destroyed over 1000 buildings each, killed over 40 people (combined) and caused losses of up to $300 Million in 1985 Canadian dollars. Similar events normalized to current populations, wealth, and inflation are expected to cause losses approaching $1 Billion.
All of Canada is subject to Hail Storms, with most occurring in the West and in southwestern Ontario and in the Alberta region particularly near Calgary. These regions can expect up to ten hailstorms each year. The rest of British Columbia, Ontario and the Plains receive an average of three hailstorms per year. The Eastern part of Canada's maritime influence prevents large hailstones from forming and as such experiences less severe hail storms. Hailstorms last from 6 to 10 minutes and are most common during the afternoons from May to July.
The greatest risk is to farmer's crops and to homes and cars. For the farming community, small hail pellets can be equally disastrous as large hail pellets to crops. Hail can strike at up to130 kilometres per hour, shredding crops, damaging structures and vehicles, and injuring people and animals.
The worst insurable hailstorm loss in Canada as of mid 1996 was the Calgary hailstorm of September 7, 1991 (item 2 on the map). A 30-minute downpour caused an estimate $$450 million in damages (Canadian National Report 1996).
There are two types of cyclones that can effect Canada: Tropical Cyclones and Extra-Tropical Cyclones. In North America, Tropical Cyclones are called Hurricanes with all striking between June and November while the ocean surface is warmest.
Hurricanes rarely reach eastern Canada and if they do they are mere remnants of their past selves. Nevertheless they do exhaust their energy, discharging heavy rain and strong winds which cause floods as they pass.
Canada's best-known hurricane was Hurricane Hazel, which affected Ontario on October 14-15, 1954. It is remembered for flooding as the seven inches of rain which hit Toronto caused extensive flooding and 80 deaths. Surprisingly so, British Columbia can also be affected by typhoons originating off Asia as they migrate past the Pacific. Typhoon Freda hit Victoria and Vancouver on October 12, 1962 causing seven deaths and extensive damage.
Mid-latitude cyclones are more significant than tropical cyclones are to Canada. Mid-latitude cyclones (extra- tropical cyclones) can affect Canada at any time but appear to be most severe in winter. During the winter, they often cause blizzards, freezing rain (i.e. glitter storms), and heavy snowfall, whereas in the summer they cause intense rainfall activity, tornadoes, and produce hailstorms.
Mid-latitude storms frequently affect the Great Lakes and the Atlantic and Pacific coasts of Canada. Aside from the flooding and winter freeze, much of the damage results from wave action against the coastline. Marine infrastructure (oil rigs, sea vessels,etc.) are the most severe marine hazard. The storm surge associated with these cyclones has caused damage to property and loss of life. The March 15, 1993 cyclone produced waves in excess of 30 m and sank the Gold Bond Conveyor off the coast of Nova Scotia killing 33 crew (Canadian National Report - IDNDR, 1994). High storm waves, especially at high tides, can erode coastlines leading to the collapse of structures and buildings.
In winter, Canadians can expect blizzard conditions and heavy precipitation over widespread areas, in the form of snow, sleet and/or freezing rain with severe ice storms. These storms cause great damage. Blizzards can happen throughout all of Canada, but are more common in the prairie regions (Stewart et al., 1995). For example, in March of 1993, a mid-latitude cyclone caused a severe blizzard and killed more than 240 people. Livestock perishes from exposure to blizzards each year (Stewart et al., 1995).
Freezing rain is a peril that can cause severe damage, especially to power transmission lines, telecommunications infrastructure, buildings, and trees, as well as to road conditions and traffic. Freezing rain can continue for days. The largest incidences occur east of the Great Lakes and in the Maritimes.
In addition, extreme cold temperatures are associated with continental Arctic air masses. Temperatures can go below -40°F. The winter also produces many lake affect snowstorms over localized regions (usually less than 25 miles inland) where one portion of a city may be inundated by one foot of snow per day, while other parts may receive none at all.
Geomagnetic storms are probably one of the least-known atmospheric hazards, occurring mostly in the high northern mid-latitudes. These storms are directly caused by solar flare activity. Normally shielded by the magnetosphere, the electrons and proton plasma or solar wind may come in contact with the earth and are directed to the Northern hemispheres by the magnetosphere where they can cause havoc on certain electric industries. On March 13, 1989, a powerful geomagnetic storm occurred causing a major power failure from northern Quebec to Montreal with losses between $10 and $100 million (Lerner, 1995). Geomagnetic storms can also produce satellite drag, disruption of ground and satellite communication, ship navigation systems, and failure of orbiting satellites (Bone, 1991). Artificial satellites may decay out of orbit earlier than expected (e.g. SkyLab, July 1979) or these storms can cause orbiting satellites to execute phantom commands, causing major malfunctions of on-board computer systems. In 1994, a $250 million Canadian communications satellite went off line for nearly six-months (Lerner, 1995).
Floods are one of the most significant natural hazards in Canada. They have high frequency and can be severe.
Flooding can have relatively rapid speed of onset, can affect large areas, and can cause extensive losses to property and life. The worst flood disaster in world history occurred in the Saguenay River valley in Quebec (due to excessive rainfall) causing more than $1 billion in damages. Damage can result after the event from back-up or runoff if their drainage systems are inadequate.
It is difficult to provide a realistic representation of flood-prone areas in Canada because there are so many potential causes of flooding. Areas most likely to have problems include all of southern Ontario and Quebec, the southern half of British Columbia, isolated regions of southern Saskatchewan and Manitoba and most of the Maritimes. The main causes of flooding in Canada are spring ice jams and snowmelt, and heavy summer rainfall.
Lightening should be considered as it does pose a major problem in its ability to ignite forest fires. It is estimated that 35% of Canada's forest fires are the result of lightening strikes and that these strikes account for 85% of the area burned. These fires destroy lumber equipment and mills as well as standing timber.
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