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Calif. Commissioner to issue notice to insurers on earthquake insurance misinformation – jj

Calif. Commissioner to issue notice to insurers on earthquake insurance misinformation


A visitor takes a photo of a crack on the ground following recent earthquakes on Sunday, July 7, 2019, outside of Ridgecrest, Calif. (AP Photo/Marcio Jose Sanchez)

Following the dual earthquakes that struck Ridgecrest and Trona in Southern California on July 4 and 5, the California Department of Insurance acknowledged reports that some insurers and agents may be declining writing earthquake policies in various areas of the state.

Insurance Commissioner Ricardo Lara and California Earthquake Authority (CEA) Chief Executive Officer Glenn Pomeroy held a joint conference call to address this misinformation and correct any confusion for state residents.

Commissioner Lara also announced he is set to issue a notice to insurers to ensure that all agents and brokers selling earthquake insurance are following California law which prohibits insurers from refusing to write CEA earthquake insurance coverage for an existing residential policyholder.

In the joint conference, Commissioner Lara and Pomeroy addressed the concern that some insurers may be confusing the 15-day waiting period after a seismic event with an outright moratorium on the purchase of a CEA policy.

Related: Earthquake preparedness: What to do before, during and after

Homeowners’ insurance will not protect you

Commissioner Lara and Pomeroy took the opportunity to remind California residents that a standard homeowners’ policy will not cover earthquake damage. Without specific earthquake coverage, homeowners are responsible for all costs to repair, rebuild or replace homes and personal property.

“Our first major earthquakes in years have Californians asking if earthquake insurance is right for them,” Commissioner Lara said in a statement. “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.”

CEA policies can be purchased anywhere in California, at any time, and by anyone who has a home insurance policy with one of our participating insurers, Pomeroy asserted. However, Pomeroy noted, for new policies purchased after an event, the CEA does not provide coverage for the next 360 hours, or 15 days, for earthquakes that are seismically related to the initial event.

The California Department of Insurance urges existing CEA customers with damage from July’s earthquakes to begin the claims process by contacting their insurance company or agent. For questions or concerns about their claim or what their insurer is telling them, contact the Department’s Consumer Services Hotline at 800-927-4357.

Related: Understanding earthquake insurance

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