Today marks the 200th anniversary of the first of the three New Madrid earthquakes, the largest seismic events to strike the eastward portion of the United States. Named for the Mississippi River town of New Madrid, Mo., the quakes occurred far outside of the part of the country known best for earthquakes, but then we had reminders in 2010 with the Haiti earthquake and this year with the Virginia earthquake, that significant seismic events do occur away from the U.S. West Coast and the highly active Pacific "Ring of Fire."
While the Virginia event was very mild, a reprise of the New Madrid quakes would be very serious. The original quakes, which occurred over a period of 54 days, had an estimated magnitude between 7.0 and 8.0, but struck a sparsely populated area, notes a statement from the Insurance Information Institute (I.I.I.), marking the anniversary. However, notes the I.I.I.:
According to a report by Risk Management Solutions (RMS), insurers could be looking at losses of between $5 billion and $50 billion if even a moderate series of earthquakes were to occur adjacent to major urban areas in the New Madrid Region today. The analysis also suggests that there is a 28 to 46 percent likelihood of a 6.0 magnitude earthquake, or greater, hitting the New Madrid area within the next 50 years. St. Louis, Missouri and Memphis, Tennessee, are the most-populous cities closest to the NMSZ.
It's worth reflecting on the potential of another New Madrid quake both as a matter of public and personal safety preparation for the area's inhabitants, as well as a potential insurance opportunity for underwriters who understand such risks. In that regard, it's worth remembering that some experts, such as Yuri Fialko of the University of California San Diego, believe that the San Andreas fault is overdue for "The Big One," a significant quake measuring 7.0 or more.
Bearing in mind RMS's estimates of the potential damage caused by a 6.0 quake at the New Madrid Seismic Zone, it's chilling to think what a much bigger quake would mean to a highly populated area. The brief video below illustrates the massive differences in energy released by earthquakes of different magnitude, putting recent quakes into stark perspective against some of the biggest events in history.
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio