ASTM E2557-07
(Practice)Standard Practice for Probable Maximum Loss (PML) Evaluations for Earthquake Due-Diligence Assessments
Standard Practice for Probable Maximum Loss (PML) Evaluations for Earthquake Due-Diligence Assessments
SIGNIFICANCE AND USE
This practice is intended for use as a voluntary standard by parties who wish to undertake the seismic risk assessment of properties. The goal is for users to objectively and reliably compare the financial risks of earthquake damage to buildings, or groups of buildings, on a consistent basis.
This practice is designed to provide requirements for the evaluation of earthquake damage risk so that technical reports prepared for the evaluation and rating of seismic risk of a building(s) will be adequate for use by other entities. Potential users including, but are not be limited to, those making equity investments, lending, and financial transactions, including securitized mortgage lending by mortgage originators, loan servicers, underwriters, rating agencies, and purchasers of bonds secured by the real estate.
The use of this practice may permit a user to satisfy, in part, their requirements for due diligence in assessing a property’potential for losses associated with earthquakes for real estate transactions.
SCOPE
1.1 This practice establishes standard-of-care for evaluation and classification of the financial risks from earthquake damage to real estate improvements for use in financial transactions. As such, this practice permits a user to satisfy, in part, their real estate transaction due-diligence requirements with respect to assessing and characterizing a property's potential losses from earthquakes. This practice is intended to address only physical damage to the property from site and building response.
1.1.1 Hazards addressed in this practice include earthquake ground shaking, earthquake-caused site instability, including faulting, subsidence, settlement landslides and soil liquefaction, earthquake-caused tsunamis and seiches, and earthquake-caused flooding from dam or dike failures.
1.1.2 Earthquake-caused fires and toxic materials releases are not hazards considered in this practice.
1.1.3 This practice does not purport to provide for the preservation of life safety, or prevention of building damage associated with its use, or both.
This practice does not address requirements of any federal, state, or local laws and regulations of building construction or maintenance. Users are cautioned that current federal, state, and local laws and regulations may differ from those in effect at the times of construction or modification of the building(s), or both.
This practice does not address the contractual and legal obligations between prior and subsequent Users of PML reports or between providers who prepared the report and those who would like to use such prior reports.
This practice does not address the contractual and legal obligations between a provider and a user, and other parties, if any.
1.1.4 It is the responsibility of the owner of the building(s) to establish appropriate life-safety and damage prevention practices and determine the applicability of current regulatory limitations prior to use.
1.2 Considerations not included in the scope: the impacts of damage to building contents, loss of income(s), rents, or other economic benefits of use of the property, or from legal judgments, fire sprinkler water-induced damage or fire.
1.3 The values stated in inch-pound units are to be regarded as standard. The values given in parentheses are mathematical conversions to SI units that are provided for information only and are not considered standard.
General Information
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Standards Content (Sample)
NOTICE: This standard has either been superseded and replaced by a new version or withdrawn.
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Designation: E2557 − 07 AnAmerican National Standard
Standard Practice for
Probable Maximum Loss (PML) Evaluations for Earthquake
1,2
Due-Diligence Assessments
This standard is issued under the fixed designation E2557; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (´) indicates an editorial change since the last revision or reapproval.
1. Scope practices and determine the applicability of current regulatory
limitations prior to use.
1.1 This practice establishes standard-of-care for evaluation
and classification of the financial risks from earthquake dam- 1.2 Considerations not included in the scope: the impacts of
age to real estate improvements for use in financial transac- damage to building contents, loss of income(s), rents, or other
tions. As such, this practice permits a user to satisfy, in part, economic benefits of use of the property, or from legal
their real estate transaction due-diligence requirements with judgments, fire sprinkler water-induced damage or fire.
respect to assessing and characterizing a property’s potential
1.3 The values stated in inch-pound units are to be regarded
losses from earthquakes. This practice is intended to address
as standard. The values given in parentheses are mathematical
only physical damage to the property from site and building
conversions to SI units that are provided for information only
response.
and are not considered standard.
1.1.1 Hazards addressed in this practice include earthquake
ground shaking, earthquake-caused site instability, including
2. Referenced Documents
faulting, subsidence, settlement landslides and soil
2.1 ASTM Standards:
liquefaction, earthquake-caused tsunamis and seiches, and
E2026 Guide for Seismic Risk Assessment of Buildings
earthquake-caused flooding from dam or dike failures.
2.2 Other Standards:
1.1.2 Earthquake-caused fires and toxic materials releases
UBC-97 Unifrom Building Code, 1997 Edition
are not hazards considered in this practice.
International Building Code 2006 Edition
1.1.3 This practice does not purport to provide for the
2.3 ASCE Standards:
preservation of life safety, or prevention of building damage
ASCE 7 Minimum Design Loads for Buildings and Other
associated with its use, or both.
Structures
1.1.3.1 This practice does not address requirements of any
ASCE 31 Seismic Evaluation of Existing Buildings
federal, state, or local laws and regulations of building con-
ASCE 41 Seismic Rehabilitation of Existing Buildings
struction or maintenance. Users are cautioned that current
federal, state, and local laws and regulations may differ from
3. Terminology
those in effect at the times of construction or modification of
3.1 See also definitions in Guide E2026.
the building(s), or both.
3.2 DBE, n—Design Basis Earthquake, as defined in Guide
1.1.3.2 This practice does not address the contractual and
E2026.
legal obligations between prior and subsequent Users of PML
reports or between providers who prepared the report and those
3.3 lateral load-resisting system, n—Lateral Load Resisting
who would like to use such prior reports.
System, as defined in Guide E2026.
1.1.3.3 This practice does not address the contractual and
3.4 MCE, n—Maximum Capable Earthquake as defined in
legal obligations between a provider and a user, and other
Guide E2026.
parties, if any.
3.5 PML, n—Term historically used to characterize building
1.1.4 It is the responsibility of the owner of the building(s)
damageability in earthquakes.
to establish appropriate life-safety and damage prevention
1 3
This practice is under the jurisdiction of ASTM Committee E06 on Perfor- For referenced ASTM standards, visit the ASTM website, www.astm.org, or
mance of Buildings and is the direct responsibility of Subcommittee E06.25 on contact ASTM Customer Service at service@astm.org. For Annual Book of ASTM
Whole Buildings and Facilities. Standards volume information, refer to the standard’s Document Summary page on
Current edition approved May 1, 2007. Published May 2007. DOI: 10.1520/ the ASTM website.
E2557-07. Available from International Organization for Standardization (ISO), 1 rue de
Portions of this publication reproduce content from the 1997 Uniform Building Varembé, Case postale 56, CH-1211, Geneva 20, Switzerland, http://www.iso.ch.
Code, International Code Council, Inc. Falls Church, Virginia. Reproduced with Available from American Society of Civil Engineers (ASCE), 1801 Alexander
permission. All rights reserved. Bell Dr., Reston, VA 20191, http://www.asce.org.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959. United States
E2557 − 07
3.5.1 Discussion—Probable maximum loss, shall be defined 4. Summary of Practice
by the user from SL or PL values using definitions of Guide
4.1 The objectives of this practice are as follows:
E2026. For SL-based measures include in the report the
4.1.1 To synthesize and document good commercial prac-
specified earthquake or ground motion for which it is to be
tice for the determination and rating of seismic risk for
evaluated and stipulate whether it is an expected value (SEL)
buildings.
or upper value (SUL). For PL-based measures, the return
4.1.2 To facilitate standardization of earthquake risk evalu-
period for non-exceedance shall be specified, or the probability
ation terminology for financial transactions.
of exceedance in a given time period provided.
4.1.3 To establish an industry standard for the requirements
3.6 probable loss (PL), n—Probable Loss as defined in
to evaluate the financial risk for real estate.
Guide E2026.
3.6.1 Discussion—When there are multiple buildings in the
5. Significance and Use
seismic risk assessment, then the damageability values for the
5.1 This practice is intended for use as a voluntary standard
group of buildings is to be determined as specified in Guide
bypartieswhowishtoundertaketheseismicriskassessmentof
E2026.
properties. The goal is for users to objectively and reliably
3.7 provider, n—organization and individual that completes
compare the financial risks of earthquake damage to buildings,
the seismic risk assessment.
or groups of buildings, on a consistent basis.
3.8 scenario loss (SL), n—As defined in Guide E2026.
5.2 This practice is designed to provide requirements for the
3.8.1 Discussion—When multiple buildings are in the seis-
evaluation of earthquake damage risk so that technical reports
mic risk assessment, then the SLfor the group of building is to
prepared for the evaluation and rating of seismic risk of a
be determined as specified in Guide E2026.
building(s) will be adequate for use by other entities. Potential
users including, but are not be limited to, those making equity
3.9 SEL, n—As defined in Guide E2026.
investments, lending, and financial transactions, including
3.9.1 Discussion—When there are multiple buildings in the
securitized mortgage lending by mortgage originators, loan
assessment then the SEL for the group of buildings is to be
servicers, underwriters, rating agencies, and purchasers of
determined as specified in Guide E2026.
bonds secured by the real estate.
3.10 SEL ,n—The scenario expected loss due to the
DBE
5.3 The use of this practice may permit a user to satisfy, in
occurrence of DBE site ground motions.
part, their requirements for due diligence in assessing a
3.11 SEL ,n—The scenario expected loss due to the
MCE
property’s potential for losses associated with earthquakes for
occurrence of MCE site ground motions.
real estate transactions.
3.12 significant damage, n—Damage costs that exceeds five
6. Due-Diligence Investigation
percent of the replacement cost of construction for the building
caused by site failure from soil liquefaction, landsliding, or
6.1 The site stability, building stability and building dam-
other earthquake-induced site response other than shaking.
ageability of the property shall be assessed.
Damage cost for this purpose includes the cost of the site
6.2 The user shall specify the condition of the property to be
topography away from the building.
evaluated. The seismic performance can be evaluated for the
3.12.1 Discussion—Conditions resulting from lack of rou-
property in its current condition, or as changed by proposed
tine maintenance, miscellaneous repairs, operating
modification of the seismic response of the soils supporting the
maintenance, and so forth are not considered a deficiency. The
building or a proposed seismically retrofitted condition of the
damage is not significant if it does not affect the structural
building(s) or its sections, or both.
elements of the building because the movement is not substan-
6.2.1 The proposed seismic modifications of the site must
tialorthefoundationisresistanttosettlement-induceddamage.
be sufficiently described to allow evaluation of the modifica-
Damage limited to underground utilities or slabs on grade is
tions by an independent qualified party.
not significant.
6.2.2 The proposed seismic modifications of the building
3.13 SUL, n—As defined in Guide E2026.
systems must be sufficiently described to allow evaluation of
3.13.1 Discussion—When there are multiple buildings in
the modifications by a qualified third party.
the assessment then the SULfor the group of buildings is to be
6.3 The Guide E2026 level of investigation shall be speci-
determined as specified in Guide E2026.
fied by the user. The same level of investigation should be
3.14 SUL ,n—The scenario upper loss due to the occur-
DBE
performed for each type of the seismic risk assessment.
rence of DBE site ground mo
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