Resilient Buildings: Economic benefits
- Gregers Reimann
- 5 days ago
- 3 min read
Updated: 3 days ago
Fun to speak to a completely new audience, the building insurance industry. The focus of this conference was on how to improve resiliency in buildings. In other words, design resilient buildings that can withstand the natural climate disasters and ideally should be able to continue its operation with any disruption. Such building resiliency is good for the building owner and its occupants. And good for the insurer, because they are unlikely to receive much insurance claims from resilient buildings, and can therefore offer cheaper insurance policies, which the building owner of course welcomes. In other words, spend a bit of money up front on making buildings resilient, and benefit from major savings down the line. One of the speakers illustrated the analogous economic scenario of investing in building resiliency this way:
The answer is obvious: Build the fence. In fact, a study found that 1 dollar spent on building resiliency will save 16 dollars down the line. Just do it!
Interestingly, the line of arguments by insurance companies towards the building owner is very similar to that of green building consultants. We both have to convince the building owner to spend some more money up front, to save money over time. We have to convince the building owner that there is a good payback time to build a resilient and/or green building. Equally interesting, after seeing IEN's presentation on "Green buildings - and resilience", the insurance company representatives thought IEN Consultants has an easier sell, because the benefit from significant building energy savings occur immediately, whereas the insurance companies have to wait for a disaster to occur (flooding, fire, typhoon, earthquake) before the benefits of a resilient building becomes evident.
IEN's slides for viewing & download
A well documented example the benefit of improving building resilience comes from Taiwan, which experienced a devastating earthquake in 1999. Once the dust settled, the damage was substantial with almost 2,500 deaths, more than 100,000 structurally damaged buildings, and USD16billion economic loss. As a consequence, Taiwan changed their building code to include mandatory earthquake proofing provisions, both for new buildings and for retrofitting of existing buildings. So, when an earthquake of a similar magnitude struck 25 years later, the now resilient building stock suffered much less damage, namely only 18 deaths, less than 100 building suffering structural damage and less than USD3 billion economic loss; refer to slide by BQE below.
Building Resilience Index
In an effort to quantify the resilience of buildings, the International Finance Corporation (IFC) has made a free online assessment system called the Building Resilience Index (BRI): https://www.resilienceindex.org/
The first step of the calculator is input the location of the building. The assessment tool automatically identifies what risks apply at the given geographical location. For example, not all buildings are located in earthquake or tsunami zones.
Next step is to answer a number of questions pertaining to design of the building in relation to the relevant risk factors. For example, is the building placed in a flood plane? Has the building been design to withstand 100-year rains? Does the building comply to certain fire code standards etc.?
The online assessment has a simple multiple choice answer of "yes", "no", "maybe" and "n.a." (not applicable). As such, for a person familiar with the building design, the assessment questionnaire can completed fairly fast in about 15 minutes. The Building Resilience Index score is given immediately following this easy to understand "speedometer" graphic shown below:
The idea that the conference organiser, QBE, and other insurance companies want to promote, is to create a common language around building resilience, so it can be easily evaluated and become part of the conversation in the building design process. Building resilience, just like other high building performance metrics, need to be incorporated the early design phase of buildings, instead of just becoming an afterthought. On this point, the insurance and green building industry have perfect alignment. The challenge is to make sure it happens. Let the journey begin!
Photo gallery
from the QBE conferences in Kuala Lumpur (15 May 2025) and in Singapore (13 May 2025):
