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"Only 10 percent of California's 7 million plus homeowners have earthquake insurance – and the number has dropped by more than half since the deadly quake" (201

"Only 10 percent of California's 7 million plus homeowners have earthquake insurance – and the number has dropped by more than half since the deadly quake" (2014) You can get an estimate for an earthquake insurance policy with the California Earthquake Authority. [1] https://www.nbcnews.com/news/investigations/why-do-so-few-california-homeowners-have-earthquake-insurance-n227711 https://www.nbcnews.com/news/investigations/why-do-so-few-ca... [2] https://www.earthquakeauthority.com/ https://www.earthquakeauthority.com/

Zafira 7y ago
I understand why people keep bring up earthquake insurance, but it's not that many of us haven't considered it. It can be expensive to the extent that you are better off reinforcing your home rather than spending any money on said insurance. "The expensive deductible related to earthquake insurance are sometimes as high as 15% of the value of the home, which has many homeowners giving the insurance a second thought."[1] Most insurance companies bailed out of the business of earthquake insurance after Northridge because when it happens, the claims are enormous. The 1906 San Francisco Earthquake was an indirect factor that lead to the Panic of 1907 due to the high volume of insurance claims. [1]https://www.marketwatch.com/story/25-years-after-bay-area-quake-most-dont-have-earthquake-insurance-2014-10-17 https://www.marketwatch.com/story/25-years-after-bay-area-qu...
- Rebelgecko 7y ago
  When I looked into it, adding on earthquake insurance would cost more than my regular homeowners insurance, and like you said would still have a huge deductible without even covering most of my belongings
  - sizzzzlerz 7y ago
    Furthermore, if a big quake happens, insurance companies are going to go broke paying out claims. Homeowners are going to be at the back of the line meaning most of them aren't going to see a dime.
- Gibbon1 7y ago
  I think the general consensus is that you'd be better using your money to get a construction loan to brace and bolt your home to resist earthquakes. I was quoted $175/month for earthquake insurance. That translates into a $25-30k loan. You can do a lot of structural improvement for that.
  - bshipp 7y ago
    But...did you? Do the structural adjustments I mean.
TimTheTinker 7y ago
I'm not clear how a CEA policy makes financial sense for a standard single-family, owner-occupied house. The only affordable plans have massive deductibles and only partial cost coverage. If "the big one" hits, it's likely that: (a) CEA will quickly run out of money and I won't be covered anyway. (b) The whole community will be ruined so assuming all of my family is still alive we'd best move somewhere else anyway (and a rebuild or undamaged house wouldn't sell). (c) Some kind of government bailout or community help program will be available. For smaller earthquakes, it's likely I'd either fail to meet my deductible or be unable to pay the non-covered portion (which has to be paid out first before they'll begin to pay for further repairs). Am I wrong, or is there something I'm missing? I wish this weren't the case.
- indemnity 7y ago
  Different country, but for the Christchurch earthquake in 2011: - our equivalent of CEA (EQC) did indeed run out of money, although it’s mostly reinsurance and govt backed - insurance companies went under, because even for a small city (400k), costs ran to $40 billion - it’s now very very expensive to get earthquake coverage, in some parts of the country you are paying multiples of what less earthquake prone parts of the country pay, so people don’t bother. so they’ll lose everything next time, and we’ll foot the bill as a country Scale of California probably means amplification if these effects, hundreds of billions in losses.
  - secabeen 7y ago
    This. The CEA is not government-backed.
- saagarjha 7y ago
  > CEA will quickly run out of money and I won't be covered anyway. I don’t understand why insurance companies can run out of money whenever they need to pay claims. I’m sure they know they’re going to go under, why can’t they get insurance on themselves?
  - richk449 7y ago
jtdev 7y ago
Why? So the sleazy insurance companies can deny or only pay a small percentage of your claim?? No thanks, the insurance industry has reduced itself to a rent seeking, regulatory capture machine with nearly zero value proposition for customers at this point.
datamingle 7y ago
Interesting startup in Earthquake insurance https://www.jumpstartrecovery.com https://www.jumpstartrecovery.com The earthquake was strong enough for a payout if you were located within the zone: https://twitter.com/yourjumpstart/status/1146850926512111616 https://twitter.com/yourjumpstart/status/1146850926512111616

Zafira 7y ago

I understand why people keep bring up earthquake insurance, but it's not that many of us haven't considered it. It can be expensive to the extent that you are better off reinforcing your home rather than spending any money on said insurance. "The expensive deductible related to earthquake insurance are sometimes as high as 15% of the value of the home, which has many homeowners giving the insurance a second thought."[1] Most insurance companies bailed out of the business of earthquake insurance after Northridge because when it happens, the claims are enormous. The 1906 San Francisco Earthquake was an indirect factor that lead to the Panic of 1907 due to the high volume of insurance claims. [1]https://www.marketwatch.com/story/25-years-after-bay-area-quake-most-dont-have-earthquake-insurance-2014-10-17 https://www.marketwatch.com/story/25-years-after-bay-area-qu...

Rebelgecko 7y ago
When I looked into it, adding on earthquake insurance would cost more than my regular homeowners insurance, and like you said would still have a huge deductible without even covering most of my belongings
- sizzzzlerz 7y ago
  Furthermore, if a big quake happens, insurance companies are going to go broke paying out claims. Homeowners are going to be at the back of the line meaning most of them aren't going to see a dime.
Gibbon1 7y ago
I think the general consensus is that you'd be better using your money to get a construction loan to brace and bolt your home to resist earthquakes. I was quoted $175/month for earthquake insurance. That translates into a $25-30k loan. You can do a lot of structural improvement for that.
- bshipp 7y ago
  But...did you? Do the structural adjustments I mean.

TimTheTinker 7y ago

I'm not clear how a CEA policy makes financial sense for a standard single-family, owner-occupied house. The only affordable plans have massive deductibles and only partial cost coverage. If "the big one" hits, it's likely that: (a) CEA will quickly run out of money and I won't be covered anyway. (b) The whole community will be ruined so assuming all of my family is still alive we'd best move somewhere else anyway (and a rebuild or undamaged house wouldn't sell). (c) Some kind of government bailout or community help program will be available. For smaller earthquakes, it's likely I'd either fail to meet my deductible or be unable to pay the non-covered portion (which has to be paid out first before they'll begin to pay for further repairs). Am I wrong, or is there something I'm missing? I wish this weren't the case.

indemnity 7y ago
Different country, but for the Christchurch earthquake in 2011: - our equivalent of CEA (EQC) did indeed run out of money, although it’s mostly reinsurance and govt backed - insurance companies went under, because even for a small city (400k), costs ran to $40 billion - it’s now very very expensive to get earthquake coverage, in some parts of the country you are paying multiples of what less earthquake prone parts of the country pay, so people don’t bother. so they’ll lose everything next time, and we’ll foot the bill as a country Scale of California probably means amplification if these effects, hundreds of billions in losses.
- secabeen 7y ago
  This. The CEA is not government-backed.
saagarjha 7y ago
> CEA will quickly run out of money and I won't be covered anyway. I don’t understand why insurance companies can run out of money whenever they need to pay claims. I’m sure they know they’re going to go under, why can’t they get insurance on themselves?
- richk449 7y ago

jtdev 7y ago

Why? So the sleazy insurance companies can deny or only pay a small percentage of your claim?? No thanks, the insurance industry has reduced itself to a rent seeking, regulatory capture machine with nearly zero value proposition for customers at this point.

datamingle 7y ago

Interesting startup in Earthquake insurance https://www.jumpstartrecovery.com https://www.jumpstartrecovery.com The earthquake was strong enough for a payout if you were located within the zone: https://twitter.com/yourjumpstart/status/1146850926512111616 https://twitter.com/yourjumpstart/status/1146850926512111616