Sunday, May 3, 2015
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Earthquake insurance shunned by vast majority of Californians

Despite California’s ever-present risk of major earthquakes, the number of homeowners in the state with insurance coverage for quake damage has dipped significantly over the past several decades, from 33 percent in 1996 to just 10 percent today.

The reason, say experts and some homeowners: the high cost of coverage, the quarter-century lapse in a major earthquake until Sunday’s shaker in Napa County, and for some people, the expectation that the state or federal government will step in to reimburse homeowners when the Big One hits.

“You think about it after the earthquakes,” said 44-year-old Robert Jordan of Napa, who has avoided getting quake insurance despite living through the 1989 Loma Prieta quake and another shaker near his home in 2000. “But it’s amazing how quickly we go back to our normal ways.”

Despite having major damage to glassware and other breakable items in his kitchen during Sunday’s quake, he added, he’s still probably not going to get a quake policy because “it’s expensive and major quakes happen so infrequently, it seems like a luxury more than a need.”

Many other people share that view, said Glenn Pomeroy, CEO of the California Earthquake Authority, a public agency that provides about 70 percent of all of the residential quake policies in the state.

“It’s out of sight, out of mind,” he said. Because it had been so long since a major temblor rocked California, he added, “A lot of people just fail to realize it could happen to them.”

Less than 6 percent of homeowners in Napa had the insurance, the authority said. And as of 2011, it said, the rate stood at 6.4 percent in Contra Costa County, 9.4 percent in San Francisco County, 10.2 percent in Alameda County, 10.3 percent in San Mateo County and 10.8 percent in Santa Clara County.

Aside from the length of time since the last major earthquake, the cost of coverage is another big reason many people shun insurance.

To be covered for earthquake damage other than fire, homeowners typically need an earthquake policy in addition to their homeowner’s insurance, and the average annual cost of earthquake premiums statewide is $798. The cost varies depending on whether the insurance comes with a standard 15 percent deductible or a 10 percent deductible. Either way, the deductible could leave homeowners with a sizable bill even if they are insured.

For example, if a person with a 10 percent deductible has insured their home for $400,000 — excluding the value of their land, which typically isn’t affected in a quake — and they suffer $100,000 worth of quake damage, they’d be responsible for $40,000, with their insurance covering the rest. Similarly, that same homeowner with a 15 percent deductible would be responsible for $60,000.

If a person assumes their house might never sustain more than $60,000 in damages, they might figure quake insurance isn’t worth the annual premium. But state officials say that could prove a risky gamble, since a home’s damage could total well above the deductible, depending on a variety of factors, including the temblor’s size, duration and proximity, as well as the home’s age, type of construction and number of stories.

“If they make a decision to not purchase earthquake insurance, they will be on the hook themselves for what may be their most valuable asset and will be responsible for 100 percent of the cost if a damaging earthquake struck,” said the Earthquake Authority’s Pomeroy.

Another common reason people avoid getting quake insurance is because they figure federal officials will come to the rescue with financial assistance after a major shaker. But even if the federal government offers help to those affected by the Napa quake, there is no guarantee it will cover everything.

“Federal and state funds alone are unlikely to be enough to get your life back to its pre-disaster condition,” warns an Earthquake Authority brochure.

One more factor in the relatively low rate of homeowners who buy earthquake insurance might be confusion, said San Francisco lawyer Robert Berg, who specializes in insurance issues.

“The earthquake policies are complicated,” he said. “So people will read them and say, ‘I don’t know what I’m getting out of this.’”

Even so, the Napa quake — where the damage has been estimated by some experts at $1 billion to $4 billion — could prompt more people to reconsider buying a quake policy.

“Most definitely,” said Michael Barry, a spokesman with the Insurance Information Institute, a nonprofit industry group. “I’m sure insurance agents in Northern California will be getting a number of calls inquiring about how to go about buying earthquake insurance.”

Mcclatchy-Tribune News Service

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

Solano County to add War on Terror names to memorial

By Ian Thompson | From Page: A1 | Gallery

 
3rd-graders study nature at Fairfield park

By Kevin W. Green | From Page: A1, 2 Comments | Gallery

 
Pros have tough time with financial news

By Bud Stevenson | From Page: C1

 
Fairfield industrial sector remains hot

By Brian Miller and Karl Dumas | From Page: C1, 25 Comments

 
I’m asking for your forgiveness

By Steve Kiefer | From Page: D2, 3 Comments

 
Calico’s legacy lives on to this day

By Brad Stanhope | From Page: A2, 9 Comments

 
Snow Mountain hike set on Mother’s Day

By Susan Hiland | From Page: A3 | Gallery

 
Library continues spring book sale

By Susan Hiland | From Page: A3

 
Knitters group about to start in Vacaville

By Susan Hiland | From Page: A3

 
Sacramento rally to support child advocacy

By Susan Hiland | From Page: A3

 
Airmen from Vacaville finish basic training

By Nick DeCicco | From Page: C4

 
Band festival brings sweet music to downtown Fairfield

By Susan Hiland | From Page: A9, 1 Comment | Gallery

 
CASA of Solano seeks volunteers

By Kevin W. Green | From Page: A13

 
Public hearing set before Mental Health Advisory Board

By Kevin W. Green | From Page: A13

.

US / World

Britain says hello to newest princess

By The Associated Press | From Page: A1

 
NYPD officer in critical condition after shooting

By The Associated Press | From Page: A6

 
‘Be Kind to Animals’ celebrates 100 years

By The Associated Press | From Page: D6, 1 Comment

Four charged with cruelty to animals

By The Associated Press | From Page: D6

 
Drop out thinks he can get you a tech industry job

By Bloomberg News | From Page: A9

Damage soars as Oakland demonstrations turn violent

By The Associated Press | From Page: A9, 7 Comments

 
Japanese PM sees ‘alliance of hope’ with US

By The Associated Press | From Page: A11

Plans are at odds over fate of medical marijuana

By The Associated Press | From Page: A11, 2 Comments

 
‘Huggy’ returns to Capitol after 12-year hiatus

By The Associated Press | From Page: A11

Sea Lion found wandering the streets of SF

By Bloomberg News | From Page: A11

 
Portman doing balancing act with re-election, trade

By The Associated Press | From Page: A12

 
Need for cybersecurity experts met by trend in cyber camps

By The Associated Press | From Page: A12

Lincoln’s hometown re-enact his funeral

By The Associated Press | From Page: A12

 
ISIS kills 25 captive Yazidis in Iraq

By The Associated Press | From Page: A14

Pope Francis set to name Serra a saint in DC ceremony

By The Associated Press | From Page: A14

 
.

Living

US colleges bringing in chaplains to serve the nonbelievers

By The Associated Press | From Page: D2Comments are off for this post | Gallery

 
Today in history: Sunday, May 3, 2015

By The Associated Press | From Page: A2

Community Calendar: May 3, 2015

By Susan Hiland | From Page: A2

 
My 67-year-old husband won’t stop viewing porn on his computer

By Kathy Mitchell and Marcy Sugar | From Page: D4

Love Your Lines: stretch marks go viral in support of women

By The Associated Press | From Page: D4

 
Horoscope: May 3, 2015

By Holiday Mathis | From Page: D4

Crabapples come in many varieties (some aren’t even crabby)

By The Associated Press | From Page: D4 | Gallery

 
.

Entertainment

PUBLISHERS WEEKLY BEST-SELLERS

By The Associated Press | From Page: D3

 
T. Coraghessan Boyle wins $30,000 for short story writing

By The Associated Press | From Page: D3

On his list: John Oates of Hall & Oates has book deal

By The Associated Press | From Page: D3

 
Illness memoir ‘The Iceberg’ wins Wellcome Book Prize

By The Associated Press | From Page: D3

TVGrid

By Daily Republic Syndicated Content | From Page: C5

 
.

Sports

Mayweather wins unanimous decision over Pacquiao

By The Associated Press | From Page: B1

 
Raiders head to Travis AFB for Day 3 of NFL Draft

By Paul Farmer | From Page: B1 | Gallery

Favorite American Pharoah rallies to win Kentucky Derby

By The Associated Press | From Page: B1

 
Grizzlies, Warriors ready to meet in conference semifinals

By The Associated Press | From Page: B1

Joey Logano uses big block on last lap to win Xfinity race

By The Associated Press | From Page: B2

 
Raiders fill more holes on final day of draft

By The Associated Press | From Page: B2

 
Odor’s RBI single in 10th lifts Rangers past A’s

By The Associated Press | From Page: B2

Michael Allen leads Champions Tour’s Insperity Invitational

By The Associated Press | From Page: B2

 
Posey, Crawford homer in Giants’ 5-4 win

By The Associated Press | From Page: B2

49ers fortify offense on third day of draft

By The Associated Press | From Page: B2

 
Murray wins twice for BMW Open final against Kohlschreiber

By The Associated Press | From Page: B2

Jeff Gordon leads Hendrick in pole-winning run at Talladega

By The Associated Press | From Page: B2

 
Kreider’s early goal leads Rangers over Capitals in Game 2

By The Associated Press | From Page: B2

Thompson ricochets to share of LPGA Tour lead with Park

By The Associated Press | From Page: B2

 
Paul lifts Clippers past Spurs, 111-109 in Game 7

By The Associated Press | From Page: B3

McIlroy in a fight with Casey until darkness gets in the way

By The Associated Press | From Page: B4

 
.

Business

Starbucks breakdown shows how registers have evolved

By The Associated Press | From Page: C1 | Gallery

 
Offshore wind energy sector off to slow start in US

By The Associated Press | From Page: C2

Recalls this week: Kaleidoscope toys, batteries

By The Associated Press | From Page: C2

 
A chip off the old Croc: The return of the ugly shoe

By Bloomberg News | From Page: C3, 1 Comment | Gallery

Review: Getting your Apple Watch? Here’s how to use it

By The Associated Press | From Page: C6

 
US seeks to compensate victims of Sudan, Iran and Cuba

By The Associated Press | From Page: C6

 
.

Obituaries

Sherman Elwood

By Nancy Green | From Page: A13

 
George Benjamin Kimes Jr.

By Nancy Green | From Page: A13

Gerald Mc Devitt

By Nancy Green | From Page: A13

 
Fred L. Kirk

By Nancy Green | From Page: A13

Marcello T Gemignani

By Nancy Green | From Page: A13

 
Lois Geraldine Johnston

By Susan Hiland | From Page: A13

.

Comics

.

Summer Sunsational 2015

Solano County Fair: Something for everyone

By Daily Republic | From Page: SUM6

Get ready to get down to the music at Dixon fair

By Daily Republic | From Page: SUM13

Cars, cars and more cars

By Daily Republic | From Page: SUM18

Farmers markets, produce stands offer regional bounty

By Daily Republic | From Page: SUM19

Golf, anyone? Lots to choose from

By Daily Republic | From Page: SUM20

More wine! Solano offers much to tease the palate

By Daily Republic | From Page: SUM22

Get back to nature across Solano County

By Daily Republic | From Page: SUM23

Mondavi Center brings world-class performances to region

By Daily Republic | From Page: SUM29

Go behind the scene on Anheuser-Busch brewery tours

By Daily Republic | From Page: SUM30

Try your luck at area casinos

By Daily Republic | From Page: SUM37

Fair fun continues during summer in Napa

By Daily Republic | From Page: SUM45