NU Online News Service, March 5, 12:20 p.m.EST

A magnitude 6.4 earthquake struck south central Taiwan Thursdaymorning at 8:20 a.m. local time, according to catastrophe riskmodeling firm AIR Worldwide. Losses are not expected to exceed $1billion.

The California-based modeling firm Eqecat estimated the totaleconomic damages from the earthquake in Taiwan, including lossesfrom secondary fires and landslides at less than $1 billion. Thecompany said it expects insured losses to be a small fraction ofthis.

The epicenter was located about 25 miles northwest of the cityof Taitung, with an estimated population of 200,000, on Taiwan'sEast Coast; and 40 miles southeast of the city of Tainan, which hasa population of about 800,000 on the island's West Coast.

According to New York-based reinsurance broker Guy Carpenter,initial reports suggest key infrastructure and semiconductor firmslocated near the epicenter location were not significantly affectedby the earthquake. An official of the Tainan Science IndustrialPark, which houses plants of many tech firms, said no bigproduction losses were likely and electricity supply remainsnormal.

In the population centers of Tainan and to a lesser extentTaitung, AIR expects damage to be largely limited to nonstructuralelements such as glazing, cladding, suspended ceilings and interiorwalls, as well as to contents. Well-engineered tall and high-risebuildings should be unaffected by the quake.

In Taiwan, the majority of low- to mid-rise buildings areconstructed with reinforced concrete frames and brick infill walls.Current Taiwan Building Codes (TBC) require ductile detailing ofreinforced concrete frames, similar to the requirements of theAmerican Concrete Institute and the Uniform Building Code (UBC) of1982. Tall buildings are dominated by construction using reinforcedconcrete frames and shear walls, AIR said.

According to the Taiwan Residential Earthquake Insurance Program(TREIP), 26 percent of residential property is insured againstearthquakes, up from just 6 percent in 2002, when the insurancepool was formed.

"At the level of reported shaking, AIR expects damage tounreinforced masonry construction near the earthquake's epicenter,"Bingming Shen-Tu, principal scientist at AIR Worldwide said in astatement. "The degree of damage will depend, in part, on whetherfocal depth is closer to the current estimate issued by the USGS orthat issued by the CWB. Mr. Shen-Tu continued that in general, theshallower the earthquake, the more damaging it will be.

Focal depth has been estimated at 14.3 miles by the U.S.Geological Survey, but at just 3 miles by Taiwan's Central WeatherBureau (CWB). It is still in the early aftermath of this event andthese estimates may well be revised as additional information comesin from seismic networks worldwide.