Disaster Risk Optimization of a major Industrial facility

The scope of the project was to design a multi-tiered risk optimization strategy for a major $2.3bn worth industrial facility in Southern Europe exposed to Natural Catastrophe risks. The study included a very detailed vulnerability assessment of multiple assets of different nature and ages that are collocated in the plant, a detailed mapping of all the functions and interactions among components and -in collaboration with the client. This was followed by a scenario analysis and the assessment of loss in each scenario including direct loss due to physical damage but also loss due to business interruption considering the effects of damage on specific components on the overall system.

In order to mitigate risks, the study evaluated a several measures and concluded in the combination which included retrofitting of specific assets, indemnity insurance and a parametric coverage for the deductible, that maximizes the return on the investment (considering cost of investment options, criticality of the assets selected for retrofitting, savings due to potential loss savings and premium payments).