Earthquake Insurance Rates Skyrocket For Many Californians

Thousands of Californians are about to be hit with a big bill, as their earthquake insurance premiums go up significantly. About a million Californians have quake insurance and about 250,000 of them will soon pay two to three times as much.

It doesn't have anything to do with the powerful quakes that rocked the Mojave Desert last week. Insurance providers are using the latest scientific evidence about where big quakes are likely to hit, and that evidence apparently points to Southern California as the most likely spot.

As a result, some people in the Los Angeles area are looking at two-thousand dollar a year in premiums, while homeowners in Sacramento can get a year of quake insurance for only 300 dollars.

The California insurance commissioner says he is also putting insurers on notice that they have to adhere to state law regarding the sale of quake insurance. Commissioner Ricardo Lara's warning coming after recent earthquakes that pummeled the communities of Ridgecrest and Trona in Southern California led to reports that some insurers and agents may be refusing to write new earthquake policies in certain parts of the state.

During a news conference on Thursday Lara said, "I am concerned about reports that some insurers and agents are telling consumers there is a moratorium, when in fact you can buy earthquake insurance today. While we have Californians' attention, insurers should not create barriers to homeowners or renters who want to protect their assets from earthquakes."

The California Earthquake Authority's chief executive officer, Glenn Pomeroy, added that new policies don't provide coverage 15 days after you buy them.


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