Mass timber has the potential to be a critical building component for the cities of the near future given the need for the construction sector to reduce its reliance on concrete and steel to lower its Co2 emissions. However, as this market grows and mass timber buildings evolve to greater heights, the construction risk landscape will also be transformed, bringing risk management challenges for companies, according to the new Emerging Risk Trend Talk report from Allianz Commercial. Source: Timberbiz
“The emergence of mass timber as a sustainable construction alternative represents a significant opportunity for the building sector to reduce its carbon footprint while also satisfying a demand for a material that is more cost-efficient but as durable as steel and concrete,” Michael Bruch, Global Head of Risk Advisory Services at Allianz Commercial said.
“However, in any industry, deployment of new materials or processes can result in new risk scenarios, potential defects, or unexpected safety consequences, as well as bringing benefits, and mass timber is no different. Given this market’s expected future growth, companies should do all they can to develop a greater understanding of their exposures including fire, water damage, repetitive loss scenarios and even termite infestation, and ensure they have robust loss prevention measures in place to combat these.”
Although mass timber currently only represents a small proportion of the overall number of buildings constructed worldwide each year, nevertheless, from mixed use developments to hotels to schools, an emerging market is underway.
As mass timber buildings evolve with greater height and intricate designs, they will pose new challenges in terms of risk mitigation. This Allianz report identifies several of these hazards and challenges with Allianz Commercial risk consulting engineers also highlighting loss prevention measures to consider that could help to reduce their impact.
Mass timber is wood, and fire is the primary hazard concern, with this risk needs to be considered through all the life stages of a building – design, construction, and operation. Ongoing research and testing is being conducted to further develop a methodology for evaluating the performance of structural elements during the entire duration of a fire.
Allianz analysis shows damage from natural catastrophes is already the second most expensive cause of construction claims. Timber buildings exposed to floods may require structural controls, drying and repairs, impacting expected operating losses.
Mass timber is highly vulnerable to water damage including flood, water ingress, and plumbing leaks.
Mass timber construction has a unique supply chain and manufacturing processes that differs from traditional concrete and steel framing.
One significant disadvantage of the assembly line manufacturing process is the potential for a serial loss scenario. If a particular batch of mass timber elements has a defect, multiple elements in a structure or across project sites may be affected. Defective products is already the third costliest cause of construction/engineering insurance claims, according to Allianz.
Construction firms may face challenges in finding experienced work crews for mass timber construction projects, given its nascent status. This can result in productivity issues and safety concerns as crews navigate the learning curve of working with mass timber.
While not common in all areas of the world, termites and other wood-boring insects may pose a significant threat to mass timber buildings, potentially causing extensive structural damage over time.
You can download the Allianz document here.
