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There's both fright and satisfaction about watching a 10-foot-long two-by-four shoot out of a hurricane-strength harpoon gun at 30 mph. Just ask Denny Anderson. Sure, he's vice president of engineering and application training for the commercial insurer FM Global, but he's also the tour guide for the FM Global Research Campus in West Gloucester, R.I.

Anderson isn't your standard-issue engineer--with calculator strapped to his belt and pen holder clipped to his shirt pocket. No, Anderson's the kind of engineer who feeds harpoon guns with 10-foot-long two by fours, simulating how wind storms launch debris at people and property. And the controlled mayhem doesn't stop there. At the 1,600-acre Research Campus, Anderson leads visitors through experiments ranging from raging pit fires, hurricane-strength wind attacks, and dust detonations. He is part showman, drawing his audience from one of the campus' industrial-looking buildings to another--from the massive fire technology lab, designed like a football-field-sized airplane hangar, to the barn-like metal building that is the natural-hazards lab.

Properties large and small, big and tall, face nasty hurricanes with nicknames like Katrina and Rita. When that kind of storm grabs hold of a factory roof, it brings only dismay to the owners, and probably an expensive claim to the factory's insurance carrier.

Roofs severed from their frames automatically multiply the damage to homes as rain and wind rush into the breach. A multimillion-dollar food processing plant, for example, could easily finish the day as an aquarium.

Or if winds heave a two-by-four through an office window, the board could rattle around, damage machinery, destroy computer hardware or even kill or injure workers inside. That's why Johnston, R.I.-based commercial insurer FM Global allows commercial insurance buyers, brokers and other clients to tour its research campus and witness flying two-by-fours and disintegrating roofs--all within the confines of a secure lab. And this is one tour to which clients pay attention. They know that what they just saw in a lab could easily happen to the factories and offices for which they're responsible.

Amusement wears off quickly, particularly during hurricane season, when property damage is measured in the billions of dollars, and lives lost measure into the hundreds, or even thousands. "If you have property anywhere in a hurricane zone from Brownsville, Texas, to Bangor, Maine, go outside right now and call somebody," says Anderson addressing visitors, during a tour in late September. Call somebody to get all those roofing repairs done that they've been putting off, he said. Secure windows, doors and other openings. Anderson, who also doubles as the campus tour guide, got a chorus of chuckles from his audience, but he wasn't doing standup à la Tim Allen in a corporatized version of "Home Improvement."

On Sept. 21, a storm was coming. Hurricane Rita lurched toward Texas and Louisiana, threatening a repeat of Katrina, and Anderson spoke with the prescience of 28 years' experience in engineering and insurance.

The tour group on this day was made up of various brokers, a mustachioed gentleman from Lloyd's of London, representatives from the state of Connecticut, business leaders and other clients. Moments after Anderson's comment, a handful of them were already on their cells in the parking lot. The "evangelist of property protection," as Anderson is known, commonly inspires such spontaneous risk management. "We believe the majority of the real hazards that cause most of the property losses can be prevented," Anderson told his audience. So wind storms, earthquakes, hail attacks--these natural perils can all be engineered against so that they become more a distraction to a business, rather than a calamity.

Carol Garland, mechanical engineer and safety representative from Kingsport, Tenn.-based Eastman Chemical Co., left the tour with images of pit fires and explosions dancing in her head, but she also took back an important message to her own facilities managers. "The advantage is being able to go out to production areas and say, 'I've seen what this can do, and you don't want to see that happen.' " Then, Garland says, she can come up with the steps needed to prevent a manmade or natural catastrophe at her sites. "It's nice to see it happen in controlled conditions," Garland says, "but you don't want to see it happen in uncontrolled conditions."

An insurance policy alone is not enough and should only be a backstop to rebuilding a business destroyed by a natural disaster, says Anderson. Better construction, more careful engineering and closer emergency planning should be risk management strategies Nos. 1, 2 and 3.

"Insurance won't bring back lost customers or give your company an edge over their competitors should you suffer property damage to a key facility," says Anderson. "The savviest companies make sure they understand their business vulnerabilities and plan for them because they can't afford to suffer the consequences, such as business downtime, loss of market share or a drop in company valuation."

According to Anderson, to mitigate the risk of natural perils, business owners must find the most reliable and economically feasible solutions to their unique risks. For businesses in hurricane-prone regions, this could mean building their facilities like Fort Knox, with a few aesthetic flourishes.

Anderson is confident that a building could be engineered to withstand even 175 mph winds. FM Global has clients in Puerto Rico, he says, where Category 5 storms can, and do, come. Engineers can construct such fortified buildings by maximizing use of superior building materials, such as reinforced concrete and real stucco, and avoiding lesser materials such as metal sheeting and EIFS (Exterior Insulating Finish System), a wall system of foam and molded plastic. The number of windows can be reduced, or apertures can be shaped as narrow rectangles, instead of tall, wide openings. Windows can even be fitted with bulletproof glass.

Other factors come into play in how well a building withstands a wind storm, says Anderson. These include the structure's height and the surrounding geography. A 20-story building, for instance, can experience as much as 20 percent more wind force from the same storm as a three-story structure. A store with nothing between it and the Gulf of Mexico but seagulls stands far less chance against a Rita than a building behind trees or hills, or better yet, trees and hills. Any natural obstacles against wind are good. Of course, most companies cannot pick up and start anew with uber-engineered Nature-proof facilities. They're stuck with the buildings they got. That doesn't mean their risk managers have any excuses, however.

"Know what wind speeds your roof can resist and make sure you won't face anywhere near that," said Anderson.

Companies should know what natural hazards their facilities could face, and ensure that they can withstand them by a factor of two. For wind storms, managers can study wind maps, building codes and weather models. This data provides a threshold of wind risk--with which a risk manager could say, "OK, we could expect 140 mph winds here on our most unlucky of days."

Come up with this conservative threshold, says Anderson, but one that's not unrealistic. Then strengthen your roof to meet that danger.

Repairs could simply involve strengthening a roof's edges and corners with more $0.19-cent roof fasteners, the "screws" that hold a roof's plies to its deck. On roof edges, winds exert 70 percent higher uplifting forces--the kind that peel back or rip roofs from their frames. On the corners, wind force is higher still. There's a simple relationship between the number of fasteners and roof strength: Doubling the number of fasteners roughly doubles the roof's strength. Roofs can also be beefed up by better securing the deck to the joists. Or for even a better foundation, by fortifying the steel joist itself.

For window protection, Anderson recommends gluing plastic glazing to the back of glass panes, and anchoring the glazing to the frame. Secured to the structure's frame, window glaze deflects the force of small debris like gravel on stories above 30 feet, spreading the concussion through the glass and the surrounding area, like risk spread among insurers and reinsurers. The result is the glass may crack, but it doesn't shatter into the building, leaving an open hole for wind and rain to enter.

Below 30 feet, Anderson says, plywood or shutters are needed to protect windows from large debris.

The plywood should be attached 3 to 4 inches off glass panes. And as that FM Global two-by-four demonstration proved once again, half-inch plywood doesn't always cut it. While a single sheet of half-inch plywood is better than nothing, Anderson recommends at least three-quarter inch plywood, or even better, two sheets of half-inch plywood fastened together.

DON'T "SHINGLE" OUT WIND

Hurricane Katrina showed, however, that engineering against wind storms does not necessarily guarantee that buildings will come out unscathed. One story doing the industry rounds was that New Orleans, situated west of Katrina's eye, only suffered Category 2 wind speeds during the storm. Katrina's strongest winds, bursts reaching Category 4 speeds, made landfall to the east.

Building codes in New Orleans were geared to withstand Category 2 winds. In many cases, though, winds won. The scuttlebutt is that the "Big Easy" suffered more because of shoddy construction than it did because of hellacious winds.

This problem isn't new, and it isn't isolated to the Bayou. Anderson says that FM Global studies found that in Hurricane Andrew, as much as 60 percent of property losses were due to human error, such as poor roof installation or design.

Getting the right contractor--and avoiding this issue--is easy enough for businesses during good times, but right after a storm, there aren't enough good contractors to go around.

Anderson recommends making it part of a business-continuity plan to form special arrangements with contractors and ensure that the company will be tops on the builder's list after a catastrophe.

Then there was Biloxi, Gulfport and other beachside Mississippi towns, where wind-based building codes could never have protected businesses facing the Gulf. Category-5 flood surge stormed blocks inland, according to some estimates, at 30 feet or higher. Even the best construction gets washed away like driftwood in that.

Here, Anderson admits that engineering--and the FM Global Research Campus--may have its limits. "There is an element of bad location," he says. Or he adds, in a half-joking Tim Allen kind of way, "You could build 30 feet above the ocean."

MATTHEW BRODSKY is associate editor of Risk & Insurance®.

November 1, 2005

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