A SCHEME TO ESTIMATE THE RESILIENCE OF STRATA PROPERTIES IN CYCLONIC AREAS

Transcription

1 P A SCHEME TO ESTIMATE THE RESILIENCE OF STRATA PROPERTIES IN CYCLONIC AREAS Report: TS948 Version: Report prepared for: K. Sullivan, General Manager Risk, Insurance Council of Australia Compiled by: D. Henderson, G. Boughton, D. Falck, and G. Stark School of Engineering and Physical Sciences, James Cook University, Townsville Qld

2 A Scheme to estimate the resilience of strata properties in cyclonic areas 1 A SCHEME TO ESTIMATE THE RESILIENCE OF STRATA PROPERTIES IN CYCLONIC AREAS Executive Summary The was commissioned by the Insurance Council of Australia to outline a scheme to assess the resilience of strata properties exposed to tropical cyclones in North Queensland. The Scheme will deliver a process in which bodies corporate can choose to engage independent inspectors to assess their property and provide an Inspection Report on its vulnerability to damage from cyclones. The Inspection Report will identify and rank elements that may contribute to damage in future cyclones and will allow bodies corporate to target appropriate remedial work. The Inspection Report and possible remedial work undertaken will enable insurers to set premiums that more accurately reflect property vulnerability. The Scheme should be independently owned and administered. The administrator will provide information to bodies corporate, insurers, and inspectors, and resolve disputes between these parties. The inspectors will be independent of the body corporate and the insurer, have appropriate qualifications, training and continuing professional development. They will have been registered with the Scheme and can be engaged directly by bodies corporate. The inspection process will include information from public sources (e.g. local council web sites and maps), the body corporate (e.g. design information) and the site inspection (e.g. condition of building elements). The Inspection Report will be generated automatically with the potential for damage presented as vulnerability scores. Scores indicate vulnerabilities of the entire property, whole buildings, and elements within a building. They are presented individually for different types of potential damage (structural, amenity, storm surge and ancillary) and indicate where remediation could improve resilience. Preliminary estimates of the cost of a normal initial inspection range between $500 and $1000, but could be more for very large or complex properties. Inspection reports will be valid for a period to be decided by the Scheme administrator (suggested at between five to ten years). Bodies corporate could elect to have a follow up inspection after a tropical cyclone, remediation work or expiry of the preceding report. Follow- up inspections should take less time and therefore cost less than the initial inspection. The proposed Scheme was developed using experience from damage investigations by the CTS following tropical cyclones, data from properties with claims and those with no claims, and feedback from a range of stakeholders. It has been trialed on strata properties with known claims histories. The Scheme delivers logic- based indicators of vulnerability and provides targeted suggestions for remediation to minimize potential structural damage, rainwater ingress and damage from storm surge during future tropical cyclones. Benefits of the proposed Scheme extend beyond the potential for reduced premiums and increased understanding of an Insurer s own portfolio. The Scheme has the potential for improving the resilience of the wider community through increased awareness. The survey of buildings will allow a comprehensive assessment of building performance and potential issues. Remediation of the identified building elements that may limit strength or amenity will result in lower damage bills and a more resilient community.

3 A Scheme to estimate the resilience of strata properties in cyclonic areas 2 Contents 1 Introduction Pilot study on risk to strata properties Aim of current project Methodology Data and Information International Applications of Schemes to Achieve Insurance Rate Reduction CTS damage investigations Analysis of insurance claims data Analysis of recent claims data Vulnerability of strata properties Engagement with stakeholders Inspection Forms Background Timing Building types Questions Answers General Information Form Information from documents Information from the inspection Condition Inspection Form Summary information Information from the inspection Follow- up questions on General Information Form Inspection report Generating the Report Estimating building vulnerability Vulnerability scores Weighted Vulnerability Comparison of vulnerabilities Structural vulnerability Amenity vulnerability Storm surge vulnerability Vulnerability of Ancillary elements... 33

4 A Scheme to estimate the resilience of strata properties in cyclonic areas Ranking for remedial action Selecting elements for remediation Selecting tasks for remediation of an element Supporting information Leaflet Inspection Manual Educational resources for Developers, Bodies Corporate and Insurers Consistency of information Modes of delivery Application of the Scheme Initial Inspection Subsequent Inspections Use of Report Estimated cost of Inspections Outline of qualification requirements and training programs for inspectors Qualifications Training program Program contents Program media Assessment Ownership and administration of scheme Ownership of the Scheme Ownership of Inspection Reports Administration Responsibilities of the Scheme administrator Training Registration of inspectors Database of inspectors Maintaining Inspection Form and Report templates Quality assurance Resolution of disputes Conclusions and Recommendations Outline of proposed scheme Community benefits of the Scheme Recommendations... 47

5 A Scheme to estimate the resilience of strata properties in cyclonic areas 4 10 References APPENDIX A Inspection Forms APPENDIX B Inspection Report Template APPENDIX C Leaflet APPENDIX D Outline of Inspection Manual APPENDIX E Outline of educational resources to developers, bodies corporate and insurers APPENDIX F Scoring of vulnerabilities APPENDIX G Remediation example APPENDIX H International building inspection schemes Limitations The (CTS) has taken reasonable steps and due care to ensure that the information contained herein is correct at the time of publication. CTS expressly exclude all liability for loss, damage or other consequences that may result from the application of this report. This report may not be published except in full unless publication of an abstract includes a statement directing the reader to the full report. Acknowledgments The CTS acknowledges the support of the Insurance Council of Australia (ICA). The project was funded by the ICA, with the policy data provided by the ICA Strata Insurance Working Group. CTS thanks the Strata Insurance Working Group for permission to use some of their photos in this report. We would like to thank the stakeholders from the various industries and community that contributed their time and knowledge during the discussions on the survey scheme and proposed operation. David acknowledges the assistance of T. Searle in the preparation of the report.

6 A Scheme to estimate the resilience of strata properties in cyclonic areas 5 A SCHEME TO ESTIMATE THE RESILIENCE OF STRATA PROPERTIES IN CYCLONIC AREAS 1 INTRODUCTION The was commissioned by the Insurance Council of Australia to outline a scheme that could address the resilience of strata properties in North Queensland in response to cyclonic conditions. The has extensive experience in investigating the performance of buildings in wind- related events such as cyclones. The knowledge gained has been used to provide education and information across the building and construction sectors, and to monitor the adequacy of building codes and standards for future construction needs. Damage investigations and reports after major wind events [1-7] have generally shown that buildings that are well designed, well built and well maintained offer acceptable structural performance but may still have potential for water ingress. Where issues were identified, damage investigation reports have recommended changes to building practices, revisions to standards or changes to building regulations. This project focuses on strata properties. These types of properties have been subjected to significant increases in insurance premiums in recent years. A report from the Australian Government Actuary [8] concluded that average strata insurance premiums have had to increase to cover the costs incurred by the insurance industry in recent years. However, they did not consider whether there are opportunities to better understand risk and use this knowledge to limit premiums without undermining insurance profitability. This project outlines a scheme that includes an inspection process to provide an assessment of the resilience of strata properties. Inspections will be conducted by independent, trained and appropriately qualified inspectors. The processes of assessing property vulnerability and acting upon any issues identified can help to understand and reduce risk. This can help to set more realistic premiums, with particular benefit for more resilient buildings. Through a better understanding of risk and action to address vulnerabilities, property owners and managers can have more confidence in building performance and insurers have information that can help to limit insurance premiums without increasing their business exposure.

7 A Scheme to estimate the resilience of strata properties in cyclonic areas Pilot study on risk to strata properties In 2013, the Insurance Council of Australia engaged the to conduct a pilot study to review strata property insurance claims that resulted from recent cyclones. [9] The aim of the pilot study was to identify factors that may be repeatedly contributing to insurable losses, and to identify opportunities to mitigate risk of damage in cyclones. One of the recommendations from that study was the introduction of regular property inspections (perhaps every 7-10 years) to identify and prioritise any site- specific factors that might affect building performance in future wind events. The pilot study identified that water ingress from wind driven rain was a key factor in insurance claims. Ancillary items were also shown to have taken on increasing importance in claims costs in recent years and perhaps more so in strata property. These items would also be expected to feature in an inspection system. The pilot study also identified that, even when property risk factors are identified, there is often no process in place to encourage or require owners or managers of existing properties to maintain or upgrade those properties to minimize risk in future wind events. 1.2 Aim of current project This project follows on from the pilot study. It outlines a property inspection process and how it might be used. This report is based on the Terms of Reference set by the Insurance Council of Australia and outlines a potential scheme that could be accessed by a Body Corporate to: a. Provide an appropriately qualified/trained professional (service provider) to carry out an examination of a strata property with regard to extreme weather vulnerability. b. Identify specific building issues that could lead to extreme weather damage and subsequent insurance claims. c. Identify remediation options to address detected vulnerabilities for consideration by the Body Corporate. d. Deliver a report to the Body Corporate on the status of the building with regard to detected extreme weather vulnerabilities (or the lack thereof) that could voluntarily be used by the Body Corporate in negotiation with their insurer.

8 A Scheme to estimate the resilience of strata properties in cyclonic areas 7 The ICA terms of reference noted the following issues to be reported on: a. The specific building issues that should be considered by the service provider when examining a strata building for extreme weather vulnerabilities, that relate to an increased probability of insurable damage occurring. b. The qualification and/or training requirements necessary for the service provider to be able to provide services through the Scheme. c. Minimum reporting standards and templates for the report that would be delivered by the service provider to the commissioning body corporate. d. Ownership, IP and liability provisions of the delivered report from the service provider. e. The projected cost to the body corporate of an inspection by the service provider, to enable consideration of a government assistance grant to drive the Scheme. f. Management of the Scheme including recommendations regarding an appropriate agency or institution that could administer applications by a body corporate to access a service provider. g. Quality Assurance mechanisms for the Scheme. h. Community and body corporate education requirements regarding the Scheme. i. Underwriter education requirements regarding the Scheme. j. Any other issues considered relevant to the establishment of a functional government funded scheme to deliver a service to body corporate in tropical Australia.

9 A Scheme to estimate the resilience of strata properties in cyclonic areas Methodology The following is a summary of the methodology used in the project and refers to the relevant sections that provide further detail: Investigation of other inspection schemes (Section 2.1). A literature search of international inspections schemes was undertaken to see whether suitable schemes had already been developed. Aspects of any of the schemes that may be applicable for the Australian context were identified. These schemes were also used at various stages of the project to check that all relevant issues had been covered. Analysis of previous CTS damage inspections (Section 2.2). The experience CTS has gained from inspecting damaged and undamaged buildings following tropical cyclones since the 1970s provided a link between damage and deficiencies in building design and construction. Analysis of recent insurance claims data (Section 2.3). Some insurance claims data was made available to the project and was used to indicate relative frequency and costs of damage to different elements. Engagement with stakeholders (Section 2.4). A number of stakeholders including insurers and brokers, certifiers, assessors, engineers, residents, and strata property managers provided input and feedback at various stages of the project. Development of Inspection Forms (Section 3). Inspection Forms based on previous CTS damage investigation forms, other inspection schemes, insurance claims data and ideas from stakeholders were drafted. Trial and refinement of the Inspection Forms (Section 3.2). The draft Inspection Forms were trialled on properties in the Townsville and Cairns areas. Claims histories of some of these buildings and practical issues raised during the trial inspections were used to refine the Inspection Forms. Development of the Inspection Report (Section 4). The analyses of insurance claims and damage investigations were used to establish links between the answers from the Inspection Forms and vulnerabilities of elements to damage. These links were programmed into an Excel spreadsheet to automatically generate the Inspection Report from the responses in the Inspection Forms. Development of outlines for supporting documents (Section 5). Outlines of information for inspectors, insurers and bodies corporate were developed. These documents provide suggestions for the format and content of the supporting information that is required for the operation of the Scheme. Documentation of suggestions for the design and administration of the Scheme (Sections 6, 7 and 8). These include suggestions for training and registration of inspectors, ownership, administration and quality assurance of the Scheme.

10 A Scheme to estimate the resilience of strata properties in cyclonic areas 9 2 DATA AND INFORMATION 2.1 International Applications of Schemes to Achieve Insurance Rate Reduction The use of property inspections to assist in the setting of insurance premiums is not new. There are several well- publicised international examples. A common feature in all of these programs is some form of collaboration between levels of government and insurers, in recognition of the need to resolve a common problem. Examples of schemes currently operating overseas are outlined in Appendix H. Many of these schemes focus on flood insurance [10], although some recognise that floods can be associated with severe wind events. A dedicated wind- storm mitigation program has been developed in the United States [11]. The British government has recently activated the Flood Re program, due for effect in summer of 2015 [12, 13]. These schemes are all based on inspection of existing properties to assess whether they offer acceptable resilience, based on the knowledge, practices and regulations that exist at the time of inspection. It is likely that contemporary building practices will be different to those that applied when many of the buildings were constructed. It is also possible that materials may have deteriorated since construction, unless maintenance has been adequate. These issues led to the development of inspection processes and are also valid considerations for the current project. 2.2 CTS damage investigations The has undertaken damage investigations following a number of tropical cyclones. More recent Australian examples include: Tropical Cyclones Vance (1999) [2], Larry (2006) [3], Ului (2010) [6] and Yasi (2011) [7]. During each of these investigations, a damage survey was conducted. Damage inspection forms have been refined with each use and in all events have given useful information on the type of construction, the specific details of the damage and issues that may have exacerbated the damage. The reports following each investigation highlighted common issues that precipitated the damage. These included: Water ingress, which can result in a claim even though there has been no damage to structural elements; Failure of specific structural elements (e.g. batten- to- rafter connections); Failure of other building elements (e.g. windows or garage doors); Damage to the building envelope from windborne debris; Damage to fences, sheds, pergolas and other ancillary items; and Damage to buildings and sea- side facilities due to storm surge effects.

11 A Scheme to estimate the resilience of strata properties in cyclonic areas 10 These investigations have established causal links between elements that can be inspected and the damage that could lead to a claim. This information was used in the preparation of the questions in the Inspection Forms (Section 3), the spread sheet that evaluates the vulnerability of elements, the Inspection Report, and recommendations for remedial action (Section 4). 2.3 Analysis of insurance claims data The method for assessing and scoring elements in the surveyed properties as well as the overall property score was based on using the claims versus non- claims data provided by Insurers, together with information on construction methods and materials and damage survey findings. The claims/non- claims data, as opposed to economic vulnerability/hazard loss models often used in Insurance and re- insurance industries (catastrophe models), was used as: the loss curve vulnerability models are typically proprietary black boxes which may or may not have an engineering and/or loss base for the curves; typically the outputs of the models are relevant for populations (large averages) of building styles or geographic region and not property specific; the use of claims/non claims for this project has direct relationship to the region and is transparent coming from the insurers own data; and this project requires assessment and ranking of hundreds of details in an individual property to provide a rating and feedback for that specific property. The alternative approach of developing a detailed and calibrated probabilistic model was outside the resourcing for this project. However, an appropriately researched and designed probabilistic vulnerability model based on engineering principals could produce guidance on levels of risk for varying hazard levels (occurrence rates for various wind speed/rain intensities) as well as to potentially price for changes to portfolio components and evaluate cost of remedial actions and building code changes but would require extensive proofing and calibration. A benefit of the currently proposed building survey scheme and ratings will be in greatly refining the black box vulnerability models over time with the comparison and calibration to claims data. If this survey/rating process is undertaken, it is recommended that a public domain engineering probabilistic vulnerability model is developed. The process for this project therefore draws upon extensive experience in conducting damage investigations after cyclones, as well as reviews of insurance claims data, to rank building features and their effect on performance in cyclones. While damage investigations and associated activities have been successful in identifying and addressing structural deficiencies in buildings [1-7], insurance claims will not always be aligned with structural performance. It is known that significant insurance claims can be incurred for buildings that might be considered to be code compliant [9]. The perils that lead to insurance claims vary across Australia. Severe weather events are a common cause for claims in North Queensland. In the process used in this

12 A Scheme to estimate the resilience of strata properties in cyclonic areas 11 project, insurance data from recent strata claims after wind events has been reviewed, to identify the main items included in claims. A review of claims data helps to identify items that are damaged but does not always provide the cause of that damage. Judgement has been used to estimate the vulnerable element or system or causal relationship that resulted in the claimed damage Analysis of recent claims data This project included analysis of strata claims data from Tropical Cyclone Larry (2006) [3], Tropical Cyclone Ului (2010) [6] and Tropical Cyclone Yasi (2011) [7]. Although much of the data provided was incomplete or not presented uniformly (some claims made general statements about the type of damage or only indicated the value of the claim without specific details), they were combined with knowledge of building performance from damage investigations, to develop Inspection Forms and Inspection Report templates. Key claims items were analysed to determine the most likely cause of the defect in each case. Where possible, consideration has been given to whether any failure has resulted from a design issue, a construction issue or whether other factors such as debris impact, product durability or maintenance may have affected performance. In considering the role that wind and water have had in building performance, both claims data and policies without claims were assessed against wind speed data for the local area during the relevant event. For example, while Townsville was exposed to the effects of Cyclone Yasi, the maximum recorded wind speed at the Townsville Airport was 135 km/h. This is much less than the maximum wind speed where Cyclone Yasi crossed the coast at Mission Beach and also much less than the structural design wind speed for the Townsville area (250 km/h). In theory, there should have been little damage (and therefore few claims) in the Townsville area from wind speeds of 135 km/h, yet there were a number of insurance claims for properties, including strata. Wind speed, location to coast, building geometry, materials and construction, age of building, claims description, ancillary elements, were analysed from the data provided. Properties were categorised by construction types such as engineered and residential type construction as well as into single, double and medium- rise geometry. The data shows ratios of claims to non- claims for medium rise engineered construction were far greater than the other types, for locations in coastal areas, as shown in Figure 2.1. Further analysis showed a higher percentage of claims in newer construction associated with wind driven water ingress and items such as linings, outdoor entertaining areas, lifts, etc.

13 A Scheme to estimate the resilience of strata properties in cyclonic areas 12 Figure 2.1 Proportion of building styles with claims and no claims for the Townsville region following Tropical Cyclone Yasi Vulnerability of strata properties In accordance with the relevant Australian Standards [14, 15] properties in Australia should be designed to resist a wind speed that is unlikely to be exceeded in the 50 year design life of the structure. While there is a very small possibility that this wind speed could be exceeded, if structures were designed to a wind speed that would never be exceeded, they would be prohibitively expensive. If the property does experience a wind speed that is close to or above the design wind speed for the location, there is a low, but increasing with wind speed, probability that some form of structural failure may occur and in such a case, it is likely that this structural failure will represent a significant component of any claims cost. The majority of the cyclones that occur will result in properties experiencing wind speeds that are less than the design wind speed, as was the case, for example, in tropical cyclones Larry (2006), Ului (2010), Yasi (2011) and Ita (2014). In similar events, there may still be significant insurance claims, but in general these claims should not be for structural failures. It is possible that structural failures could occur as a result of impact from flying debris, for example. In other cases, however, structural failure at wind speeds far less than the design wind speed may require review by a competent engineer to identify the reason for the failure and ensure that rectification will result in a property that offers adequate performance in future wind events. Some of the items that have been identified as leading to claims in cyclonic events in locations that have wind speeds less than the design wind speed include damage from wind- borne debris and water ingress, and failure of ancillary components outside the building envelope. In the case of wind- borne debris, it is possible that vegetation or building materials can become airborne and penetrate unprotected windows or other parts of the structure. This project accounts for these factors by including potential for debris impact in the calculation of the vulnerability score.

14 A Scheme to estimate the resilience of strata properties in cyclonic areas 13 Analysis of claims data has shown that water ingress is a major contributor to claims in recent events [9]. Figure 2.2 highlights the higher proportion of claims that have damage from water ingress and Figures 2.3 and 2.4 illustrate damage to soffits and ceilings respectively. Understanding the reasons for this water ingress and where possible, identifying actions to mitigate the risk will help to shape the inspection process. It must be remembered, however, that the wind speed in most of the events considered was less than the design wind speed. Should an event occur where the design wind speed is exceeded, the cost of structural failure may significantly exceed the costs of water ingress. With defective roof Without roof damage With roof damage Without opening damage With opening damage Total mentions Figure 2.2 High proportion of claims include damage from water ingress Figure 2.3 Damage to soffit

15 A Scheme to estimate the resilience of strata properties in cyclonic areas 14 Figure 2.4 Damage from water ingress to ceiling of exterior walkway Ancillary components outside the building envelope have been included in the Inspection Forms developed for this project as they often feature prominently in claims. Figure 2.5 shows loss of lightweight sailcloth covers without any structural damage. Ancillary items may also become debris that causes failures in other buildings on the property as shown in Figure 2.6. These items may be considered by some to be outside the scope of building regulations and may warrant special consideration in industry literature, insurance policies or regulation, to support acceptable performance. Acceptable performance may well be, for the case of shade structures, to be removed during cyclone preparedness/watch phase, and not include in the design, features such as cupboards and benches that rely on the sail for weather protection. Figure 2.5 Loss of shade sails that provided cover to kitchenette.

16 A Scheme to estimate the resilience of strata properties in cyclonic areas 15 Figure 2.6 Shade structure failed and caused damage to parapets and pool area The claims data was used to select building elements for inclusion in the Inspection Forms and the reporting of vulnerabilities. 2.4 Engagement with stakeholders Informal and formal discussions via , phone and in person were used to gain advice and feedback on and information for various aspects of the project including: level of detail of properties for policy data; consistency of claims reporting; elements that frequently appear in claims; usefulness of a dedicated property inspection; proposed content of the Inspection Forms; ownership of the Inspection Report; and remedial work. The following are excerpts from discussions with stakeholders: Reduction of policy premiums was consistently mentioned by stakeholders in these discussions. While inspection reports should help in this process, setting of premiums is outside the scope of this project. The process will encourage community discussion that will increase awareness of preparedness and maintenance of buildings and the value of participation in the Scheme. While there will be a range of financial benefits, some may become even more evident in the longer term.

17 A Scheme to estimate the resilience of strata properties in cyclonic areas 16 The level of detail collected by the insurer of the building attributes varies from insurer to insurer and ranges from external features and age through to lists of plant equipment, outbuildings, etc. One of the insurers noted that its brokers are advised that a discount may apply if an older building has engineering reports highlighting compliance with later or current legislation. The process for determining the relativities in the scoring being based on claims and policies without claims data was viewed as a good approach. For some of the stakeholders not familiar with probabilistic vulnerability models, the use of the claims data leads to a transparent approach in setting the scoring relativities for the building/property components and overall property. A comment from a broker; The procedure of a building inspection harks back to a previous time where the underwriter actually went to the property they were insuring. Implementing an approach where the insurer is more engaged with the owner may enable better understanding of the various aspects of the insurance policy. Policies typically include not only insurance against damage from weather events but items such as loss of rental income, public liability, glass breakage, and employee fraud. The level of detail being collected in the survey may allow insurers to better itemise aspects of the risk allowing owners to choose if they want to cover items such as damage to gardens, cleaning of pool, etc to reduce premium and excess. (Note that in the proposed Scheme, the inspector would be independent of the insurer or broker). Feedback from certifiers and engineers pointed out the usefulness of the survey since elements such as awnings, air- conditioning units, etc can be installed well after the building and its compliance inspection have been completed, without due care for design wind loads or water runoff. Positive feedback was received from stakeholders on the scoring system based on both structural resilience and common items (damage from wind driven rain, fences, etc). There was general agreement with the level of detail but for a lot of properties (especially older properties) the body corporate is unlikely for the property to (if ever) have engineering drawings and specifications detailing the original building code design parameters. Some stakeholders were concerned that Inspections will always find something wrong. It will be rare that a building will have a perfect score/rating. However, it must be realised that current insurance premiums are set on current building conditions that include these details (status quo). This may mean that there is a need to establish what is the current average condition of strata properties, so that increased awareness of building condition does not drive inappropriate increases in premiums and discourage the use of the Scheme. Rather, the intention is to seek opportunities to reduce premiums where possible, based on an assessment of lower than average risk. Many stakeholders said that the survey process will highlight and raise awareness of issues relating to improving the resilience of buildings. Even what might be considered a minor issue of getting body corporates to write down and discuss cyclone (or other) preparedness management plan (e.g.

18 A Scheme to estimate the resilience of strata properties in cyclonic areas 17 what to do with furniture on balconies, shade- cloth, lifts, no power, etc) has wider community benefits. A few stakeholders raised the benefit for this process to educate the building management to educate new owners (and tenants via the owners). Be careful what you wish for. Stakeholders suggested that older buildings may have more maintenance issues and less sinking funds than recently constructed buildings. The survey is enabling a refinement of knowledge giving more detail and enabling of targeted remedial works when needed. The building owners should not be penalised for finding out issues of the building that neither they nor the insurer knew. It is also recommended that following the building survey that there be a moratorium on defects to enable owners to rectify with no adverse penalty on premiums, for say 2 years, to allow remedial work to happen. The community as a whole becomes more resilient as a consequence to the building work. Ownership of the survey report attracted interesting discussions as this represented independence from the insurer, broker or government. Generally ownership was felt to reside with the building management. There is however a possibility that needs to be investigated, that by being given the report on the building performance, the building management may therefore have a liability issue in not conducting suggested remedial work that is of a structural nature. It was noted that residential buildings are inspected at the time of construction, for compliance with building regulations. There is currently no existing process for inspection of buildings after construction, so consideration is rarely given to the impact of improvements to building codes and standards on the resilience of existing buildings. Furthermore, little consideration is given to the effects of durability and maintenance on the resilience of buildings. Inspections of existing buildings are not cheap, but nor are inspections of buildings currently under construction. We accept that the latter is a necessary part of ensuring that our buildings are fit for purpose. It is suggested that we should also consider the value that can come from ensuring that existing residential property, which represents that majority of the building stock, offers resilience that is considered adequate based on today s knowledge.

19 A Scheme to estimate the resilience of strata properties in cyclonic areas 18 3 INSPECTION FORMS The key element in the Scheme is the Inspection Forms that use objective responses to targeted questions on a range of elements in strata properties. An example of the Inspection Forms for a property with four different types of buildings is given in Appendix A. The questions in the Inspection Forms were developed using ideas from the following existing forms: vulnerability assessment forms for housing, damage assessment forms Vulnerability assessment forms from overseas examples (Section 1.4 and Appendix H) The inspection process is limited to assessing only those elements that are visible or accessible in an undamaged building. However, some elements that contribute to the vulnerability of a building are deep within the building and may require removal of part of the building to directly inspect them. The s experience gained from inspecting buildings damaged during tropical cyclones was central to identifying questions used in the Inspection Forms that may indicate the condition of hidden structural and waterproofing details. Damage investigations following TC Yasi in 2011 [7] highlighted the extent of not only structural damage, but also damage caused by rainwater ingress and storm tide inundation. These observations were incorporated into the Inspection Form to enable assessment of: Vulnerability to wind damage Vulnerability to rainwater ingress Vulnerability to storm surge inundation In addition, insurance claims data (Section 2) indicated that damage to ancillary items such as fences and swimming pools posed a significant cost. Extra question on these items were included in the Inspection Forms. Pilot Inspection forms were trialled on four different types of strata properties in Townsville in early April, The results of the trial were used to refine and expand the Inspection Form.

20 A Scheme to estimate the resilience of strata properties in cyclonic areas Background Timing The Inspection Forms were specifically designed so that the initial inspection captures all of the information on the property, and follow- up inspections focus on things that have changed since the previous inspection. Two forms will be used during the inspection process: The General Information Form (Section 3.2) asks questions about design and construction of all facilities on the site. The Condition Inspection Form (Section 3.3) asks questions on the condition of parts of elements that may deteriorate over time, and prompts inspectors to check for features that may have been added or removed since the previous inspection Building types Strata properties vary widely in character and include: Apartments (multi storey) (Figure 3.1(a)); Townhouses (two storey); Single storey units (Figure 3.1(b)); Garages; Residential aged care facilities (comprising independent units, nursing home, communal hall, swimming pool area, etc.) (Figure 3.1(c)); Resorts (comprising accommodation units, shared facilities, swimming pool area, etc.); and Light industrial and commercial offices and warehouses Figure 3.1 (a) Apartment building Figure 3.1 (b) Single storey units

21 A Scheme to estimate the resilience of strata properties in cyclonic areas 20 Figure 3.1 (c) Residential aged care facility The inspection assesses all buildings on the strata property. In order to streamline this process, the buildings on a single site are divided into building types, with each type differentiated by factors such as number of storeys, building materials, size, or purpose. In this way identical buildings can be grouped as a single building type and one typical building inspected to represent all of the others. Most strata properties contain a number of different types of buildings. Some examples: Residential units, townhouses and apartment blocks (without any communal areas) would have one building type replicated many times, but may also have a maintenance shed which is a second type of building; Aged care facilities may have several different building types eg. residential bungalow- style units replicated many times, one separate communal building for activities or meals, a separate multi- storey building used as a high care facility, and a communal shed; Resorts may have three or four different building types eg. reception building, accommodation units replicated many times, undercover swimming pool area, restaurant and maintenance shed; and Figure 3.2 shows an example of an Inspection Form for a property that has 25 two- storey residential units, one communal building, one communal shed, and 20 carports separate to the residential units. The Inspection Forms have a separate column for each building type to enable assessment of up to six different building types. This means that the inspection can be specific about which buildings are most vulnerable.

22 A Scheme to estimate the resilience of strata properties in cyclonic areas 21 Figure 3.2 Example of different building types on an Inspection Form Questions The questions in both Inspection Forms are grouped to enable inspectors to assess elements in a logical order. General Inspection questions: relate to the whole property or for each building type that can usually be answered by: o using plans or documentation; o standing on the ground outside the building; o looking at the roof from the outside; o looking in the roof space from a manhole; or o inspecting a representative unit or part of the building. include ancillary items on the site. Condition Inspection questions: for each building type that can usually be answered o by inspecting a representative unit or part of the building; o from the ground outside the building; or o by looking in the roof space from a manhole. for ancillary items on the site. In the draft forms, the questions are colour coded to highlight the point of reference for each block of questions: Green shading indicates that the question pertains to the whole strata property. A single answer to each question is expected. Blue shading indicates that the question pertains to each building type. A single answer for each building type on the property is expected. Mauve shading indicates that the question pertains to a representative unit or part of the building for each building type.

23 A Scheme to estimate the resilience of strata properties in cyclonic areas Answers An answer key accompanying each question has been provided for these draft (spreadsheet- based) inspection forms. However, in other platforms, drop- down menus would be used to select the appropriate response. The most common responses for each question are included in the answer key. All questions must be answered and if the element is missing or cannot be inspected, an NA should be selected. In the draft Inspection Forms, pink shading on a cell indicates that an answer is required. Appendix A contains some background and guidance on answering the questions. 3.2 General Information Form The General Inspection form is completed in its entirety during the first inspection only. Answers may be amended during follow- up inspections if changes have been made to any of the building types Information from documents The first questions in the General Inspection Form (Q 1.1 to Q 2.12) can be answered in advance of the visit, by requesting appropriate documentation from the Body Corporate or by accessing information from Local Council websites, on- line maps and other public sites. Also, Q 3.1 to Q 3.4 may be answered using satellite images if available. Access to design documentation and building certification is a good indicator of whether all aspects of the design have been properly assessed. While the inspection forms were developed with the assistance of data from claims (and by definition, failures), they will be used on buildings that have not experienced a failure. It is therefore only possible to check that all reasonable care has been taken in design and that all parts of the property have been evaluated and should be capable of withstanding a design wind event. Access to documentation will greatly assist the process and lead to better structural vulnerability scores Information from the inspection The questions included in the Inspection forms have been specifically selected to target known vulnerabilities in buildings. For example, Q 3.17 focuses on the size of eaves as an input required to determine vulnerability to water ingress if perimeter gutters overflow; overflow from perimeter gutters damages soffit if the eaves are large and ceilings if the eaves are small.

24 A Scheme to estimate the resilience of strata properties in cyclonic areas 23 The darker shading over some questions indicates that the inspector is prompted to check these questions when completing the Condition Inspection form during follow- up inspections. 3.3 Condition Inspection Form The Condition Inspection form is completed in its entirety during the first inspection and each follow- up inspection. For follow- up inspections, the Condition Inspection form imports information from the previously completed General Information form Summary information In the draft, summary information immediately under Q 9.1 is linked to the General Information form. Where any of the information has changed since the previous inspection, the inspector must amend all of the relevant questions in the General Information form. For example, where the roof of one building type has been structurally upgraded since the last inspection, all questions in the General Information form related to the roof should be amended for that building type Information from the inspection The questions included in the Condition Inspection form require a qualitative assessment of condition or maintenance of elements. The Inspection Manual will contain photographs that will enable consistency in these assessments Follow- up questions on General Information Form At the bottom of the Condition Inspection form, some questions and answers are reproduced from the General Information form. All of these responses should be checked as these are items that may have changed since the previous inspection. For the draft, if there are any changes, the appropriate questions in the General Information form should be amended. (The process may be different for a different software platform.)

25 A Scheme to estimate the resilience of strata properties in cyclonic areas 24 4 INSPECTION REPORT An example of an Inspection Report for a property with four different types of buildings is given in Appendix B. The example is indicative of the way the Inspection Report could be presented. (Vulnerabilities have not been evaluated for some of the elements in the example.) Figure 4.1 shows part of this example. (a) Identification of property (b) Summary information on vulnerability of each building type (c) Detailed information on element vulnerabilities fore each building type Figure 4.1 Example of Inspection Report Figure 4.1(a) shows the information that identifies the property. Figure 4.1(b) presents a summary of each vulnerability for each building type in the property (in this case, residential units, communal building, communal shed and carports). The weighted vulnerabilities are evaluated separately for each building type and can be seen at a glance. An indication of the vulnerability that applies to the whole property is calculated from the vulnerability of each building type. Figure 4.1(c) shows the same weighted vulnerability as shown in the summary, but also presents the calculated individual vulnerability of each element for each building type.

26 A Scheme to estimate the resilience of strata properties in cyclonic areas Generating the Report The report is currently generated automatically using an Excel spreadsheet, but can be adapted to other forms of data management. The report provides: Estimates of vulnerabilities (Section 4.2) Ranked lists of vulnerable elements for remedial action (Section 4.3) 4.2 Estimating building vulnerability The answers to the questions in the Inspection Forms are used to estimate the vulnerability of the buildings and ancillary items in the strata development. The potential damage is sub- divided into: Structural damage refers to issues that cause parts of the building to break or detach due to the effects of wind and/or air- borne debris (Section 4.2.4); Amenity damage refers to the potential of damage to affect everyday use of the building. Water ingress is the main issue for amenity vulnerability (Section 4.2.5); Storm surge damage refers to damage caused by wind driven sea water entering or impacting the building (Section 4.2.6); and Damage to ancillary items refers to damage to other items on the site (Section 4.2.7). The damage to particular elements in buildings is usually a response to the complex interaction of a number of factors. These interactions have been refined from the work performed in past damage inspections and form the basis of calculations used in the vulnerability models reported in this section Vulnerability scores The vulnerability models use the interaction of the results of a number of questions in the Inspection Forms to mathematically estimate the potential for damage to particular elements in the property. These potentials for damage are presented as a vulnerability score (Figure 4.1) that are used to indicate vulnerabilities of elements, whole buildings and the property: A vulnerability score of 0.5 or less indicates a lower probability of damage than normal and resilience in a severe wind event. No mitigation is required and the Inspection Report represents this as a green light. A vulnerability score greater than 1 indicates that the probability of damage is higher than normal. It would be classified as vulnerable and mitigation is required. The Inspection Report represents this as a red light. A vulnerability score between 0.5 and 1 indicates that the probability of damage is in the normal range. (It should perform adequately in a severe wind event.) The Inspection Report represents this as a yellow light. Some elements in this category may be selected for mitigation in order to improve the resilience of the whole property.