The California Earthquake Authority has reportedly paid numerous claims for damage to homes that sustained relatively minor damage from the March 28 magnitude-5.1 La Habra earthquake. To date, most claim payments from the La Habra shake are to help cover costs for emergency repairs—a new feature in CEA homeowners policies that does not require meeting a deductible to receive payment.
Many claims filed after the La Habra quake have been denied because many of those residents did not have separate earthquake-insurance policies. Other claims have been denied because their damage did not exceed their coverage deductibles.
CEA’s policies are designed to help homeowners and renters recover from damaging earthquakes. Deductibles of 10 or 15 percent are necessary to help reduce premiums. Though some believe earthquake-insurance premiums for older homes in high-risk areas are costly, CEA has lowered rates over time by a total of 45 percent and offers earthquake coverage for all Californians who insure their home with a CEA participating insurer, regardless of where they live.
California has two-thirds of the nation’s earthquake risk, yet fewer than 11 percent of California residents have protected their household finances with earthquake insurance.
Source: California Earthquake Authority
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