IMIA Conference

Working Group Paper 94 (15)

Stadiums

Mexico - September 2015

Working Group Contributors

Working Group Members

Jeremy Terndrup, Willis

Eric Brault, AXA Corporate Solutions

Rony Daniel, Doha Insurance

Mohamed F.El-Ailah, Qatar General Insurance and Reinsurance Co

Roman Gromotka, Munich Re

Anna Lukyanova, Renaissance Insurance Group

Georges Helou, SCOR

Roman Emelyanov, Sogaz

Ilya Gremin, Sogaz

Marina Zyuganova, Renaissance Insurance Group – Chairperson

IMIA EC Sponsor: Olivier Hautefeuille, SCOR

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Contents:

1. History of a stadium construction. Role of a stadium in a modern world.

2. Risk description

• Anatomy of a stadium

• Prototypes and challenging structures

3. Risk analysis

• External perils

• Inherent perils

4. Available insurance coverage and underwriting considerations

• Risk management process

• Risk monitoring

• Available coverage

5. Lessons learned from claims. Conclusions

• Claims examples

• Conclusions

.

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The history of stadium construction – more then 2 500 00

thousand years

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The transformation of the stadium: from ancient times to modern futuristic

projects :

What has been changed: What remains stable:

Stadium has got additional functions

throughout the time

Huge complex construction

Changing of the design: adding a

superstructure/high tech

installations

Attracts a lot of people

From public funding to private

funding

Basic design elements (excluding

roof) remain stable

Anatomy of the stadium: what should be examined and

assessed?

Underwriters should carefully analyse the project and assess which parts are the most

challenging and needs attention throughout the construction and operation:

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The most important parts

are:

Roof

Pitch (moving pitch,

grass coverage)

High tech building

installations

Types of the stadium construction projects - particularities:

As such,

A detailed and relevant risk engineering assessment becomes required that extends beyond

standard project evaluation concepts.

Such appraisal is essential to lay the foundation for the prudent provision of intended policy cover

and technical pricing approach.

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New construction Reconstruction

Risk connected with the prototype structures Risks connected to the existing structure

(property)

Lille stadium (France) Luzhniki Stadium (Russia)

Analysing and assessing the risk

External perils: Inherent perils:

- Vicinity and location - Design and architectural view

- Climate - Building service systems

- Soil ( dynamic and static loads) - Transformations of the elements

- Construction process

- Robustness of the structure

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Global risk matrix for exposures

1) Frequency is not included for Natural hazards as it depends on the location of the project.

2) Wind storm severity have to be increased to High in case of projects located in areas subject to heavy snow falls/freezing rain or hurricanes/typhoons. A layer of ice 1 cm thick means an additional weight of almost 100 kg per 100 m2.

3) Flood severity can be considered Low where morphology allows to clearly separate different flood areas/chat basins.

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Hazards MPL Scenarios Frequency Severity

H M L H M L

Natural hazards (6)

Earthquake Total loss for projects within 50km from the epicenter.

1)

X

Ice and snow accumulation

Large part of the works can be affected by the same event resulting in roof collapse on seats and structures.

X

Wind storms Large part of the works can be affected by the same event resulting in roof destroying or collapse on seats and structures.

2) X

Flood Partial loss of structures plus possible collapse, in case of violent flash flood.

X 3)

Landslides Possible collapse. X

Lightning Lightning storms usually affect limited parts but with possible risk of total fire following .

X

Subsidence

Effects depending on subsoil conditions affecting foundations and structures in case of construction on filled areas (also as consequence of EQ).can lead to destroy and rebuild

X

External Hazards

Aircraft impact Large part of the works can be affected by the event resulting in roof destroying or fire following then collapse and total loss.

X X

Bush fires No great exposition X X

Terrorism & SRCC

Great exposition with wide risk of collapse or fire following which will lead to complete loss. This may happen during end of work or stand by/silent risk period.

X X

Theft Theft of minor to moderate quantities of valuable goods (bulky items) stored at the construction site or partially assembled along the line.

X X

Nearby man-made hazards

Yes for low intensity and attritional level (5) X X

Project intrinsic hazards

Fire The most exposed items are internal systems and PML usually refers to the largest fire unit.

X X

Faulty design and workmanship

Clearly depending of the architectural novation. If the structure is very well known the risk is rather low, if the structure is complete new one calculation, with specific raw materials and bad quality checking chain system then become ith with high intensity

X

X(4)

Construction operations Lifting, erection operations are intrinsically risky given special equipment and high rise structures

X X

The importance of risk monitoring

• Helps to avoid and/or diminish the damage to property and injuries among

people

• Gives the additional instrument of control on the construction process

• Helps the Insurer with the careful assessment during the construction period,

warranty period

• Essential for DSU/IDI insurance

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Engineering insurance coverage for Stadiums

PP (project policy) LD (liquidated damages) IDI (inherent defects insurance)

NB!! The importance of possible accumulation of risks

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MD Section TPL Section DSU Section

Risk monitoring clause is

recommended, high exposure

during the maintenance period

High TPL exposure during

maintenance shouldn’t be

neglected

• Careful pricing

• Project revenues are very

sensitive to the completion

on the certain date

• Highest exposure during the

last days of construction

Claims example 1

Date

7/07/2011

Source: http://en.wikipedia.org/wiki/File:Grolsch_Veste_1.jpg

Stadium: FC Twente stadium

Grolsch Veste

(Enschede -NL)

Capacity: 30 206

Located: Enschede, Netherlands

Built: 1997–1998

Cause of accident

- engineering

errors

engineering errors

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Accident description

During the renovation work at the Grolsch Veste, the roof of the building collapsed.

Source: http://en.wikipedia.org/wiki/File:Grolsch_Veste_2.jpg

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Cause of failure

.

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Technical factor Human factor

•The insufficient stability of the

incomplete roof structure.

•Time pressure

•The main original construction

sequence of the work were

abandoned

Claims example 2

Date

14/02/2004

Project : Transvaal (largest water

park in Moscow)

Capacity: 2 000

Located: Moscow, Russia

Built: 2002

Cause of accident Design error

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Accident description

Roof collapse due to:

inadequate design engineering mistakes

made in course of erection

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Lessons learned from claims

Main reasons for claims are:

Natural hazards

Design errors

Errors and omissions during assembling

Large losses can arise both during the construction and warranty period

A lot of large losses during the warranty period are connected with the psychological

behaviour of the crowd and thus are unpredictable

The others are connected with the design errors combined with the AoG (usually storm)

The time pressure is crucial for this type of construction: a lot of accidents was due to

human factor meaning a lot of changes in the working schedule which was initially

agreed

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Conclusions and recommendations of the Working Group

• Careful analysing of the risk

• Risk monitoring during project stage, construction and warranty period

• Prudence is granting defects coverage, TPL during maintenance, DSU

• Assessing the risk accumulation

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Thank you for your attention!

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