![]() Two decades is a long time, especially in California. “We are trying to move from a one-size-fits all approach to allowing consumers to choose the types of coverages that most meet their needs,” Pomeroy said. The goal is to offer a similar range of deductibles for personal property protection. Pomeroy said the CEA is seeking changes that would give homeowners more of these options, including a range of deductibles from 5 to 25 percent. “This would lower the premiums significantly and also incentivize people to invest in risk reduction measures such as retrofitting parts of their house.” Michel-Kerjan said he and colleagues have discussed alternatives, like a lower deductible paired with a 90-10 rule –- meaning the insurer covers 90 percent of the costs of repairs and the homeowner covers the remaining 10 percent. “Unless one expects massive damage to the property, this does not seem like a good bargain,” he said. the reward.Įrwann Michel-Kerjan, executive director of the Wharton Risk Management and Decision Processes Center at the University of Pennsylvania, explains that for some who reject the insurance, the cost of premiums and deductible only seems justified in the worst-case scenario. Anecdotally, state officials say they have heard instances in which professionals –- estate planners, insurance and real estate agents and financial advisers – have discouraged clients from buying earthquake insurance after calculating the risk vs. They often opt not to buy the insurance even though they can handle the price. People of greater means have a different version of sticker shock. For people of moderate income, that monthly pricetag can seem like a luxury. California houses aren’t cheap –- the current median sale price is just under $400,000, and is higher in many of the counties most at risk. Premiums for earthquake insurance range from $800 to $5,000 annually, and deductibles are typically 15 percent of the total value of the home. The percentage of insured homeowners, which had continued rising after the Loma Prieta quake and topped 30 percent, dropped after Northridge. But homeowners weren’t - and still aren’t - required to buy earthquake insurance. ![]() In response, the California Legislature created the CEA to guarantee that coverage was available to homeowners. Some stopped offering earthquake insurance and others raised the premiums exponentially.įollow NBC News Investigations on Twitter and Facebook. Insurers were swamped with 300,000 residential claims totaling $12 billion. Then the Northridge earthquake of 1994 hit the San Fernando Valley north of L.A. A CEA policy can give you the strength to rebuild after a damaging earthquake.Click Here to Read the RMS Report 'When the Big One Hits' We have flexible coverage choices and deductible options to help you find the policy that best meets your needs and budget.ĬEA is a not-for-profit, publicly managed, privately funded organization that encourages California homeowners, mobilehome owners, condo-unit owners and renters to reduce their risk of earthquake damage and loss through education, mitigation and insurance. Protect your home and your belongings and get coverage for additional living expenses with CEA. And loans (if you qualify) must be repaid. And government assistance (if available) is limited, and only for emergency safety needs. Home insurance does not cover shake damage-a separate policy is required. ![]() ![]() Protect yourself, your family and your finances with earthquake insurance After a damaging earthquake, the dawn we once knew could look completely different come tomorrow. Will today be like any other? Or a day that turns our world upside down? No one really knows. An earthquake could happen at any time in California, even today. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |