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REACHING FOR THE SKY
By Christian Müller, Senior Underwriter, Property Construction
In 1885 the world's first skyscraper, the ten storey Home Insurance Company Building in Chicago, was erected and the race to build ever taller structures ignited. Since then the competition to build these vertical wonders has spread around the world. The Taipei 101 Tower in Taiwan is a soaring 508 metres and for many years held the official title of "world's tallest building." Emaar Properties' Burj Dubai in the Middle East, with 161 floors designed to reach over 800 metres into the sky is the next contender to hold the crown of the "world's tallest building." Over 10,000 consultants and construction workers are involved in completing the project.
Improvements in technology allow the construction industry to keep reaching higher. For example, Burj Dubai is constructed from a unique concrete mixture. The unprecedented height of the structure required an advanced pump to send the special mixture over 600 metres to the top, a process which takes more than 30 minutes. In the meantime, plans have already surfaced for three even taller buildings to be built in Kuwait, Saudi Arabia and the United Arab Emirates.
LARGER RISKS
Along with grander and costlier construction projects come larger potential risks. This makes the need for risk assessment during both the planning phases and on the construction site ever more critical.
When assessing tall building construction risks, XL Insurance's underwriters as well as civil and risk engineers must analyse various aspects of the project. These include materials' stress resistance; architectural and technical design and security measures. The first task is to check if the project can be executed as planned. Given that the risk evaluation during the underwriting stage of such construction projects takes place only on paper, the process requires a detailed understanding of the materials and technology being used, as well as the natural environment that the building will be exposed to.
Environment and natural disaster exposures, such as earthquake risk; previous ground pollution exposure; weather conditions; the geology of the planned site and the groundwater table play a key role in assessing the viability of a skyscraper. Extreme weather conditions in Dubai with temperatures up to 50°C during summer required that the concrete mix be cooled with crushed ice. A super-tall building's capacity to withstand severe winds is also critical. The wind gusts during a cyclone can reach 300 km/h. Detailed and repeated wind tunnel studies were conducted to get to the distinctive stepped shape of Burj Dubai to withstand winds. The shape of a tower is very important in the mitigation of these wind forces enabling service-ability during all weather conditions.
Unlike risk assessment of already erected buildings where the focus is mainly on the structure itself, with high-rise projects, especially those on a grand-scale, a level of trust and confidence must be gained in the professionals involved in the planning and construction of the new building. We must be convinced that the principal, project manager and main contractor have the experience to successfully complete the project, and that they are willing to cooperate with our team to take effective risk management measures to reduce or avoid losses before and during the construction.
Once a project breaks ground the main concern on all construction sites is the most basic of risks – fire. For tall building construction sites that employ thousands of workers and house tons of materials, a fire can result in an astronomical loss of money and time, and even lives. Hence extreme precautions need to be taken, such as the temporary fire fighting and water supply systems installed for the Burj Dubai project.
As the new inhabitants of Burj Dubai are getting ready to move in, our underwriting experts are already assessing possible sites that could hold one of the next super-tall towers of the world.
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INsight is an XL Insurance publication. Copyright 2011. All rights reserved.
"XL Insurance" is a registered trademark of XL Group plc and the global brand used by its insurance company subsidiaries. Coverages are underwritten by Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Insurance Company of New York Inc., XL Select Insurance Company, XL Specialty Insurance Company, XL Insurance Switzerland, XL Insurance (Bermuda) Ltd, XL Insurance Argentina S.A., XL Insurance, Mexico S.A. de C.V., and XL Insurance Company Ltd. Coverage placed with Lloyd’s Syndicate 1209 are managed by XL London Market Ltd and supported by an XL corporate member at Lloyd’s. Lloyd’s ratings are independent of XL Group plc. Not all of the insurers do business in all jurisdictions nor is coverage available in all jurisdictions.
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