Despite the impetus of the Oct. 1, 1987, earthquake, Californians are no closer to affordable earthquake insurance than they were a year ago, insurance industry experts testified at a state Senate hearing in Whittier.
Industry leaders are pushing for the federal government to create an earthquake insurance program similar to the flood insurance program, but it will be five to seven years before such insurance will be available, according to testimony at the hearing of the subcommittee on earthquakes of the Senate Committee on Insurance, Claims and Corporations. The hearing was convened by subcommittee Chairman Sen. Cecil N. Green (D-Norwalk).
Although the state has required insurance agents to offer earthquake insurance since 1985, only 10% to 15% of California homeowners have the insurance. Industry experts say a huge earthquake could cause up to $50 billion in damage.
During the hearing, industry representatives debated whether to replace earthquake insurance with a single policy that would cover all natural disasters and whether the federal government should rescue the insurance industry in the event of a massive earthquake.