Californians Aware of Their Vulnerabilities to Temblors, But Generally Don’t Purchase Quake Insurance Related Articles The Earthquake Page The Earthquake Information Kit
A tsunami warning was issued and then canceled today for the Indonesia region after two earthquakes with magnitudes of 8.7 and 8.2 struck the Indian Ocean this morning, a little more than a year after the California coast sustained $100 million damage from a tsunami generated by a 9.0-magnitude earthquake in Japan.
Four of the five costliest earthquakes in the past three decades have occurred in the past three years. The 2011 Japanese earthquake and tsunami remains the costliest disaster of this type in recent history, causing more than $35 billion in insured losses.
The 1994 6.7-magnitude Northridge earthquake is second only to the Japan quake on the list of costliest quakes dating back to 1980, having caused $15.3 billion in insured losses at the time it occurred, or $22.5 billion in 2010 dollars, according to the Insurance Information Network of California.
Since 1900, earthquakes have occurred in 39 states and have caused damage in all 50. There has not been a major quake on the U.S. mainland, however, since the Northridge quake. It and the 1989 6.9-magnitude Loma Prieta earthquake were the two costliest temblors in U.S. history, as defined by insured losses. The Loma Prieta quake resulted in insured losses of $960 million in 1989, or $1.69 billion in 2010 dollars.
Despite the state’s exposure to seismic risk, few Californians purchase earthquake insurance. Less than 12 percent of the state’s homeowners are estimated to have purchased quake policies, according to IINC.
“The potential cost of earthquakes is growing because of development in seismically active areas and the vulnerability of older buildings which may not have been built or upgraded to current building codes,” said IINC Executive Director Candysse Miller.
Earthquakes are not covered under standard U.S. homeowners or business insurance policies. Earthquake insurance is a supplemental policy to standard home or business insurance. In California, homeowners can also secure coverage from the California Earthquake Authority (CEA), a privately funded, publicly managed organization.
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 twitter.com/iinc and on Facebook at facebook.com/iinc.org.ADDITIONAL RESOURCESCalifornia Earthquake Authority