In just the past few years, the Caribbean has experienced significant loss-causing major hurricanes, such as Gonzalo (2014), Matthew (2016), Irma and Maria in 2017, and Dorian (2019). Because tropical cyclones (TC) tend to be the primary drivers of natural catastrophe risk in the Caribbean (although the region is also at risk for devastating earthquakes), it is critical for (re)insurers to manage and mitigate TC risk effectively.
Modeling and quantifying TC risk in the Caribbean is challenging because many factors that contribute to the response of the built environment to tropical cyclone winds must be accounted for, including: the heterogeneity of the countries that make up the Caribbean, resulting from their individual colonial histories; the nature of the built environment in terms of construction materials, building practices, and the evolution of building standards and adoption practices; the different insurance markets that operate within each country and associated policy terms; and insurance take-up rates when it comes to various market segments. AIR has invested a significant amount of time and resources into understanding these various factors and they are taken into account in our new vulnerability modeling framework, which is incorporated into the substantially updated AIR Tropical Cyclone for the Caribbean, anticipated for release this summer.
The model also includes, by necessity, newly developed and enhanced Industry Exposure Databases (IED) for the Caribbean, reflecting the built environment of the region, as well as a detailed study of the evolution of building code requirements and construction regulations of each of the 29 countries in the model domain. Moreover, the observations made during damage surveys after recent major hurricanes such as Gonzalo, Irma, Maria, and Dorian not only confirmed what we know about the kind of damage that hurricane winds can cause but also enhanced our knowledge about the performance and vulnerability of the impacted regions. Such enhanced knowledge has also been implemented in the updated model.
The AIR Tropical Cyclone Model for the Caribbean provides a realistic view of TC risk and an updated stochastic catalog reflecting current historical data, as well as new features and capabilities, including support for additional lines of business such as infrastructure, marine lines, a detailed view of the temporal and spatial variation of vulnerability, and high-resolution unknown damage functions. In this article, we focus on the key aspects of Caribbean TC vulnerability—in particular, the region’s common construction practices and building regulations and standards, the performance of the building stock observed during the recent major hurricanes, and the lessons learned.
Although many building characteristics (construction type, roof cover, etc.) are a product of the common construction practices of each region, many others are not. For example, low-level construction details such as member connections (roof cover to roof deck, roof to wall, etc.), reinforcement, and material properties are not; yet many of these have significant impact on a building’s level of wind vulnerability. A detailed study of building codes, their requirements, and enforcement levels can shine significant light on and help us capture the impact of such characteristics on the vulnerability of the building stock in the Caribbean.
Building codes and standards are the documents used by engineers to properly design various structural and nonstructural building components. Typically, these documents have specific requirements tailored to address the design and construction needs of buildings constructed in different regions. These include design specifications allowing building components to withstand loads from extreme events such as hurricanes and earthquakes. Building codes evolve to provide the most efficient techniques and practices for addressing such design challenges.
In the Caribbean, different countries have implemented different building codes during different time periods. A comprehensive discussion of all relevant Caribbean building codes across different time periods is beyond the scope of this article but Caribbean countries generally fall into four basic categories with respect to their building code adoption: (1) adoption of Caribbean building codes, e.g., CUBiC (Caribbean Uniform Building Code) and OECS (Organization of Eastern Caribbean States); (2) adoption of European building codes, such as Euro Code-1 and the French NV-65, with local amendments, with Dutch-governed countries adopting the Netherlands Housing and Building Ordinance for the permit process and requirement, with no adoption of an official building standard; (3) adoption of a version of ICC (International Code Counsel) standards and reference to International Building Code (IBC) and International Residential Code (IRC) with local amendments and requirements for the design and construction of buildings; and (4) country-developed building codes such as Reglamento para Diseño y Construcción de Edificios en Mampostería Estructural for Dominican Republic, and Norma Cubana 285:2003 for Cuba, although in their development they might have borrowed from other well-established standards such as ASCE-7 (American Society of Civil Engineers) for wind force calculations (Figure 10).
No matter how strong and rigorous the requirements of a building code are, if they are not properly enforced, they typically won’t be implemented in the design and construction of buildings. Similar to building code adoption itself, code enforcement level in the Caribbean varies significantly from one country and time period to another. The level of enforcement depends on several factors such as the economy, the government, the availability of resources (e.g., adequate number of experts), and the impact of recent hurricanes (Figure 11).
Stronger building codes, good enforcement, and good building materials/conditions are among the most important contributors to the relatively lower vulnerability of countries such as Bermuda, the Cayman Islands, and those that are part of France. On the other hand, countries such as Cuba and Jamaica are the most vulnerable as a result of no to low building code enforcement and low building quality.
The extensive amount of research conducted to better understand the characteristics of the built environment in the Caribbean region in collaboration with local experts and integrated with our global wind engineering expertise as well as our numerous observations of building behaviors during damage surveys inform the substantially updated AIR Tropical Cyclone Model for the Caribbean, which has been extensively validated.
The updated model spans all 29 countries that make up the Caribbean and shares 90-meter resolution industry exposure databases that include high-value exposures, such as luxury hotels and resorts, with the updated AIR Earthquake Model for the Caribbean, also anticipated for release this summer. With the new vulnerability modeling framework, the upcoming AIR Tropical Cyclone Model for the Caribbean provides a more detailed and accurate view of the potential damage hurricanes can cause, enabling more effective risk management.