Earthquake insurance, Yes or No?

[Peace]

When we were looking at real estate in the east we were well informed of the “flood” areas and assured it was no problem because the mandatory federally backed insurance was cheap – and that was true. Of course it encouraged people to go ahead and buy in flood zones (usually a little less expensive than non-flood areas).
So why doesn’t the federal gov subsidize earthquake insurance? It certainly is a less predictable natural disaster than floods are. Some of the flood areas in the east flood regularly.
In San Francisco the only people I knew who had earthquake insurance owned condominiums because it is required in multi-dwellings. That is why HOA fees are so expensive in San Francisco.

[Peace]

When we were looking at real estate in the east we were well informed of the “flood” areas and assured it was no problem because the mandatory federally backed insurance was cheap – and that was true. Of course it encouraged people to go ahead and buy in flood zones (usually a little less expensive than non-flood areas).
So why doesn’t the federal gov subsidize earthquake insurance? It certainly is a less predictable natural disaster than floods are. Some of the flood areas in the east flood regularly.
In San Francisco the only people I knew who had earthquake insurance owned condominiums because it is required in multi-dwellings. That is why HOA fees are so expensive in San Francisco.

[Alex_angel]

Rustico, no I haven’t purchased anything. My Wife’s sister has asked but If I started the thread by saying “I’m looking for a friend” everyone would think I meant me. So instead I just asked the question point blank,

[Alex_angel]

Rustico, no I haven’t purchased anything. My Wife’s sister has asked but If I started the thread by saying “I’m looking for a friend” everyone would think I meant me. So instead I just asked the question point blank,

[XBoxBoy]

The reason that the federal government doesn’t subsidize earthquake insurance but does subsidize flood insurance has to do with politics. Some states receive lots more handouts (subsidies) while others receive far fewer handouts. If you are in a state that the politicians want to court, then your state will get lots of subsidies.

The states that win in this little game are those with few voters per electoral vote, and those that have close elections between democrats and republicans. California, where the earthquake insurance would be needed, is neither of these. We have way too many voters per electoral vote and we overwhelmingly vote democrat. That’s also why the republicans hardly campaign at all in California in the presidential elections.

This also leads me to believe that many politicians (particularly senators) are not going to be very inclined to bail out the SoCal housing market. There’s just nothing in it for them. They may allow lots of speeches and they might nod their heads approvingly, but getting something through the senate that helps mainly california is a tough task.

[XBoxBoy]

The reason that the federal government doesn’t subsidize earthquake insurance but does subsidize flood insurance has to do with politics. Some states receive lots more handouts (subsidies) while others receive far fewer handouts. If you are in a state that the politicians want to court, then your state will get lots of subsidies.

The states that win in this little game are those with few voters per electoral vote, and those that have close elections between democrats and republicans. California, where the earthquake insurance would be needed, is neither of these. We have way too many voters per electoral vote and we overwhelmingly vote democrat. That’s also why the republicans hardly campaign at all in California in the presidential elections.

This also leads me to believe that many politicians (particularly senators) are not going to be very inclined to bail out the SoCal housing market. There’s just nothing in it for them. They may allow lots of speeches and they might nod their heads approvingly, but getting something through the senate that helps mainly california is a tough task.

[lonestar2000]

Don’t expect a government bailout in leu of earthquake insruance, just look at New Orleans, people are still waiting for that check.

I agree with the general sentiment of the thread, if you have your own money in the balance and it is an older home, by all means get the insurance. If you bought with 100% financing and the home has newer earthquake avoidance techniques incorporated then you are probably ok without it.

It also matters what the home is built on. Loose sand makes for liquid like movement in an earthquake, not much survives that. In contrast, if the home is built on bedrock it will probably have much more limited movement during an earthquake and has a better chance of surviving intact.

In the end you have to weigh all the pros and cons and decide based on your tolerance of risk…kind of like investing in stocks, climbing rope, quality parachutes, filtered water, condoms, etc. 😛

[lonestar2000]

Don’t expect a government bailout in leu of earthquake insruance, just look at New Orleans, people are still waiting for that check.

I agree with the general sentiment of the thread, if you have your own money in the balance and it is an older home, by all means get the insurance. If you bought with 100% financing and the home has newer earthquake avoidance techniques incorporated then you are probably ok without it.

It also matters what the home is built on. Loose sand makes for liquid like movement in an earthquake, not much survives that. In contrast, if the home is built on bedrock it will probably have much more limited movement during an earthquake and has a better chance of surviving intact.

In the end you have to weigh all the pros and cons and decide based on your tolerance of risk…kind of like investing in stocks, climbing rope, quality parachutes, filtered water, condoms, etc. 😛

[Alex_angel]

How many people do you guys know that own it? So far I haven’t found one person at work that does.

[Alex_angel]

How many people do you guys know that own it? So far I haven’t found one person at work that does.

[The-Shoveler]

Nor_LA-Temcu-SD-Guy

I think the question to ask is your lot half fill / half Cut, Usually the view homes are built on half fill/half cut lots, if you have a hill in your back yard it is most likly a cut lot,

If I was sitting on a half fill /half cut lot then I would think about earthquake insurance.

I look for a view home on a cut lot when I look to buy a home myself.

[The-Shoveler]

Nor_LA-Temcu-SD-Guy

I think the question to ask is your lot half fill / half Cut, Usually the view homes are built on half fill/half cut lots, if you have a hill in your back yard it is most likly a cut lot,

If I was sitting on a half fill /half cut lot then I would think about earthquake insurance.

I look for a view home on a cut lot when I look to buy a home myself.

[novice1027]

I have it, always have. It doesn’t seem the expensive to me. I think I pay about $280/yr for it. Somewhere in that ballpark. I gives me peace of mind.

[novice1027]

I have it, always have. It doesn’t seem the expensive to me. I think I pay about $280/yr for it. Somewhere in that ballpark. I gives me peace of mind.

[Anonymous]

I been tempted to get it, owning a single family house close to the beach (PB). Living with a sand base means the house is toast if the big one hits. Before this house we live in North Park, i remember the old fashion weights slamming in the window frames in the early 90’s quake. People called from the east coast because of watching the news with LA hammered. No other damage however. After growing up in LA with earthquakes happing all the time SD is rather quiet.

I remember my folks 2 story house in LA damage back in the 70’s (mostly pool), not enough to trigger the deductible so it did not help. The insurance back then I believe was more liberal then today. Debris removal would make it worthwhile, I am going to have to check back into this.

mglsharkson

[Author]

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