Quake insurance shunned by most Californians
By Steve Johnson, San Jose Mercury News/MCT
August 27, 2014, 12:04 am TWN
San Jose Mercury News/MCT--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.