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          Earthquake Information Kit
          Flood Insurance: What Every Homeowner Needs To Know

Japan’s massive quake and tsunami should serve as a wake-up call to Californians to evaluate and prepare for perils in their own communities.
 
Relatively few Californians have purchased insurance to protect their homes and belongings from a catastrophic event like the one that has devastated Japan: Less than 12 percent are insured against earthquake damage and about 270,000 have purchased flood insurance, which covers losses from the rising waters caused by tsunamis.

In California, earthquake and flood insurance complement a standard homeowner’s insurance policy. To evaluate their earthquake and flood insurance needs, homeowners should consider the following:

• The area. Where is the nearest fault or designated flood zone?
• Home construction. Is the home wood-framed or unreinforced masonry? Has the home been reinforced? Is it attached to the foundation?
• The soil. Is the home built on fill or bedrock? Is it secured?

Additional information on assessing earthquake risk can be obtained from the California Seismic Safety Commission and the Association of Bay Area Governments. To evaluate flood insurance needs and view flood maps, visit the National Flood Insurance Program.

“While additional coverage for earthquake or flood damage may not be for everyone, it is clear that more Californians need these policies than purchase them,” said Candysse Miller, executive director of the Insurance Information Network of California. “Scientists have forecast catastrophic quakes for our state, but as it stands, few Californians will have the financial backstop to recover.”

Earthquake insurance premium is based on a number of factors based on your home’s specific risk, and must be grounded in the most current earthquake and engineering science available.

Likewise, the cost of flood insurance is determined by the potential for flooding in a given area.

While the Federal Emergency Management Agency provides a limited safety net after disasters, most of its help is in the form of low interest loans. When a home is damaged or destroyed in a disaster, the homeowner is still responsible for mortgage payments in addition to repaying any federal disaster loans.

For businesses, the Small Business Association may have limited disaster recovery loans available. Business losses may include relocation costs, inventory and equipment replacement, as well as relocation costs for personnel.

IINC is a non-profit and non-lobbying trade association dedicated to helping the public understand insurance and manage risk. For more information, please visit www.iinc.org. IINC is also on Twitter at http://www.twitter.com/iinc and on Facebook at http://companies.to/iinc.

ADDITIONAL RESOURCES
California Seismic Safety Commission 
Association of Bay Area Governments 
National Flood Insurance Program 
Small Business Administration