Why This Matters for Data Centers
Designed to protect the seismic exposures of data centers, Descartes’ parametric earthquake coverage uses the latest scientific research to assess risk directly at the facility level. When ground shaking reaches predefined triggers, it enables swift indemnification to support recovery from physical damage, business interruption, non-damage business interruption (NDBI)
This solution is designed for under construction sites, operational sites, large-scale facilities, small-scale facilities (e.g., edge), adjacent power plants, and more.
It can be used to fill exclusions (e.g., NDBI), address high deductibles in traditional property policies, or provide top-up capacity above aggregate sub-limits that can be rapidly exhausted in extreme events.
Product Overview
- Index: Peak Ground Acceleration (PGA), a measurement of ground shaking intensity (maximum ground acceleration) at a given location during an earthquake event, published by USGS
- Coverage: Single or multi-location
- Geography: USA
- Limit: Up to $140 million per contract
- Insured period(s): Customized to client needs
Why Choose Descartes
- Fast, objective compensation after seismic events: The parametric loss is calculated by applying the annual aggregate limit to the payout percentage linked to the recorded PGA measurement published by USGS.
- Location-specific measure of shaking intensity: PGA reflects the level of ground shaking at a specific site, while magnitude reflects overall seismic energy and does not express shaking at a given location.
- Built for data center continuity needs: Supports recovery from physical damage, business interruption, and NDBI, and can complement traditional programs where deductibles, sub-limits, or exclusions apply.
How It Works
1) Define locations, limit, and PGA payout structure
The policy is set for single or multiple locations with a predefined payout structure linking PGA levels to payout percentages.
2) USGS publishes earthquake event data
PGA is published by USGS.
3) Trigger and payout calculation
A policy is triggered when the PGA at the insured location(s) exceeds the predefined threshold in the payout structure.
Interested in a solution?
Contact our commercial team.
FAQ
Quote requirements
• Location
• Loss History
• Policy Limit
How do you measure the intensity of an earthquake?
Descartes' parametric earthquake covers rely on measurements of peak ground acceleration (PGA). PGA is a measurement of the intensity of the ground shaking or maximum ground acceleration at a given location during an earthquake event. Ground shaking intensity is an estimated calculation published by the United States Geological Survey (USGS).
How is an earthquake policy triggered?
A policy is triggered when the peak ground acceleration at the insured location(s), as reported by the data provider, exceeds the predefined threshold in the payout structure, as agreed upon in the policy.
What types of damages are covered?
A parametric policy covers any economic loss sustained from a triggering event including but not limited to property damage, business interruption, and extra expenses. There does not have to be direct physical damage to trigger coverage.
What is magnitude?
Earthquake magnitude is a measurement of the seismic energy released at the hypocenter of an earthquake, as determined by seismographs. The hypocenter is the point within the Earth’s surface where an earthquake first originates. It is important to note that, while there is a single magnitude and hypocenter for a given earthquake event, the peak ground acceleration could vary from one location to another (depending on the distance of your location to the hypocenter, for example).
Why is PGA preferred over a magnitude measurement?
Magnitude scales indicate the overall energy released during an earthquake but do not express the level of ground shaking at a specific location. Ground motion intensity maps, like PGA maps, do provide an estimate of the level of ground shaking and, therefore, an indication of the extent of the possible damage due to an earthquake event at each location.
How does the claims process work?
1) The data provider releases the earthquake event data.
2) The calculation agent retrieves the data and informs the insured of the parameters and corresponding loss.
3) The insured submits basic information on the financial losses caused by the earthquake.
4) After the event report and declaration of loss is received, payment is released.
