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Managing Seismic Risk

Published in The RMA Journal

Lenders have long relied on a combination of insurance and due diligence to protect themselves from various forms of disaster, but earthquake insurance for commercial real estate has become cost prohibitive.

In search of a substitute, lenders have increasingly relied on “probable maximum loss” reports to identify the risk of an asset being damaged in an earthquake. The purpose of this article is to help lenders understand how to craft an effective seismic risk management policy. 

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