ON SHAKY GROUND

The earthquake hazard here may be greater than you think. And planning for it is less than you'd expect.

Another federal agency, the USGS, spends a few hundred thousand dollars monitoring ground movement over the entire length of the New Madrid seismic zone, splitting the stipend between the University of Memphis and St. Louis University. In 1996, the same agency issued projections that increase the estimated earthquake hazard for parts of the St. Louis area by 30-40 percent.

Early last year, the Insurance Services Office (ISO) of New York, a firm that represents 500 insurance companies doing business in Missouri, filed for rate increases with the state Department of Insurance. The requested rate hike would raise the price of earthquake coverage between 113 and 266 percent in portions of the St. Louis metropolitan area. The highest increases are planned for parts of St. Charles County, sections of north St. Louis County and the northern and southern tips of the city of St. Louis.

ISO relied on data analysis purchased from Risk Management Solution Inc., which specializes in computer modeling. "We were pretty unfamiliar with the way that works," says Mark Doerner, senior counsel for the Missouri Department of Insurance. The state regulatory agency is allowing the insurance companies to phase in the commercial rate hikes over a three-year period. It has placed a moratorium, however, on the requested increases to homeowners insurance. Doerner has used the delay to study esoteric earthquake research to see whether the insurance companies' data analysis holds up under scrutiny. He expects to complete his investigation soon.

With billions of dollars of property damage estimated as the result of a future Midwestern earthquake, the insurance companies are seeking to hedge their bets. "How do you make coverage available and how do you encourage the insurance companies to write it, if there is a potential for them taking such a hit?" asks Doerner.

There is very little chance of the state Legislature's establishing a reinsurance program such as the one in California, because only a handful of the state's 110 counties would likely be affected by a quake. As a result, the price of private insurance in high-risk areas is becoming unaffordable. "Some of the numbers from the Bootheel indicate that you would have to spend a thousand dollars (annually) for a $100,000 structure," says Doerner.

That leaves the possibility of rate relief up to federal legislation now being considered by Congress. The proposed law would authorize the Treasury Department to sell contracts to back up, or reinsure, homeowners' insurance issued by a state program or private firms to cover damages brought on by earthquakes and hurricanes. The bill would limit the Treasury Department's liability to $25 billion. Conservatives decry the proposal for interfering with the free-market economy. Liberals oppose the measure because they view it as corporate welfare. Environmentalists don't like the idea because it would spur development in ecologically sensitive areas. The bill is expected to be voted on sometime next year.

Even though insurance executives, government bureaucrats and academic experts disagree about the timing or magnitude of an earthquake, none questions that at least a moderate one will rock the area sooner or later. When that happens, chunks of the St. Louis infrastructure will fall apart. Building codes in the city of St. Louis and St. Louis County have only included seismic-safety standards since 1987. Structures built before that date are not required to adhere to the current guidelines unless the building undergoes major renovation. Even then, the building does not have to be seismically retrofitted unless there is a change in its usage, according to the St. Louis building code.

"Unreinforced masonry buildings are probably going to have the most damage and sometimes complete collapse," says John C. Theiss, a structural engineer for EQE-Theiss in St. Louis. EQE specializes in designing buildings to withstand earthquakes. In the city of St. Louis, an estimated 66,000 residences -- 75 percent of the housing stock -- are unreinforced brick structures, according to the Missouri Seismic Safety Commission. Almost all of the two- and four-family flats lining the city's residential streets were constructed long before the seismic-safety standards came into effect. Some of these structures were built more than a century ago.

St. Louis Building Commissioner Ron Smith downplays the effect that a quake would have on the city but admits that risks exist. "We've got a whole host of different types of buildings in the city, from frame residential all the way to high-rise masonry and heavy-timber warehouses downtown," says Smith. "Just about any structure could be vulnerable, depending on the intensity of the earthquake and the condition of the soils the building is sitting on."

In its 1997 report, the Missouri Seismic Safety Commission says that mandating structural improvements of the city's brick residences would be prohibitively expensive and could result in the abandonment of many such structures. The commission recommended incentives such as tax and insurance reductions to entice homeowners into retrofitting their houses to withstand an earthquake. No such programs have been established yet.

Although the St. Louis County Department of Public Works has assessed the hazards to some extent, mitigating the damage to schools, public buildings and emergency response facilities has not been mandated, either. The commission lists scores of hospitals, police stations, fire stations and ambulance services in the St. Louis area that would be vulnerable to the effects of an earthquake.

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