Portuguese insurers association calls for mandatory earthquake cover

The President of Portugal’s insurers association (Associação Portuguesa de Seguradores (APS)), José Galamba de Oliveira, in the wake of last months earthquake that shook Lisbon for around five seconds, says companies and householders should have to pay an automatic earthquake cover.

He says that it is not a question of “if but when” the next Great Lisbon Earthquake (1755), which destroyed two-thirds of the 18th century city, killing up to 50,000 people, occurs.

José Galamba de Oliveira said another great earthquake was “inevitable” at the opening of a conference which discussed a proposed Integrated Catastrophe Risk Management Strategy.

The president of the APS called for cooperation between insurers and the State to cover the implicit financial risks from large catastrophes, reminding that apart from earthquakes, Portugal was also vulnerable to climate changes, frequently facing large-scale forest fires, rain storms and flooding.

“There are countries that are better prepared than we are to respond to catastrophic situations,” said José Galamba de Oliveira, reinforcing that the APS has been requesting from and advancing concrete proposals for different governments and parliament for more than ten years, lamenting the fall of the current government under which the process was advancing, and admitted: “We will be back to reintroduce our proposal to the next government for a National Disaster Risk Protection System,” he said.

Portugal is located in a seismic hazard zone. Earthquakes in Portugal, especially in the Lisbon region, are related to the country’s location at the junction of tectonic plates. Portugal lies near the boundary between the Eurasian and African plates, which makes the region prone to seismic activity.

The most famous earthquake in Portuguese history was the Lisbon earthquake of 1755, which had catastrophic consequences, destroying much of the city, forcing the royal family to live in tents (admittedly very glamorous ones), and triggering a huge tsunami. It had an estimated magnitude of 8.5-9 and is estimated to have killed around 30,000-50,000 people.

Portugal and its overseas islands have suffered a number of catastrophic earthquakes over the centuries. In the second half of the last century there was the Earthquake of 1969 affecting Lisbon and the Algarve, followed by The Earthquake of the Azores (1980), The Earthquake of the Azores (1998) and The Earthquake of Arraiolos (1998).

The Lisbon region has suffered from around a dozen earthquakes over the centuries including 1358 (Severe damage), 1531 (1,500 homes destroyed with a tsunami), 1551 (200 homes destroyed), 1755 (Lisbon almost totally destroyed), 1761 (lasted five minutes), and 1858. (In Setúbal with 605 homes destroyed)

It might be better to be safe than sorry in the event of another great earthquake, but one thing’s for sure – the insurers will make lots of money in the meantime if this mandatory order goes ahead!