ERROR: Macro /header is missing!

Earthquake off Puerto Rico offers reminders about risk

  • Tuesday, January 14, 2014

  • Updated Thursday, January 16, 2014 2:12 pm

Columbia – A 6.4 magnitude earthquake that struck off the coast of Puerto Rico recently was one of the largest quakes to hit the U.S. territory in recent years. Luckily, the event caused no major devastation or deaths, and did not trigger a tsunami.

With this recent earthquake and the 20th anniversary to the Northridge, CA quake just days away, we are reminded that seismic events can cause massive destruction in the blink of an eye. The devastation can be extensive and expensive, and recovery can take years.

“While we typically don’t think about them, earthquakes pose a very real threat to South Carolinians,” said Russ Dubisky, Executive Director of the South Carolina Insurance News Service. “This is certainly coverage that individuals should consider as they look for ways to protect their family, assets, and financial futures against natural disasters.”

On Aug. 31, 1886, Charleston was hit by one of the most damaging quakes ever in the eastern part of the U.S. Experts estimate that if the Charleston quake -- which measured a 7.3-magnitude on the Richter scale and damaged 90 percent of the area’s brick structures -- were to occur today, damage to insured property would exceed $40 billion.

Recent catastrophe models, the process of using computer-assisted calculations to estimate the losses that could be sustained due to a catastrophic event such as a hurricane or earthquake, have placed a higher emphasis on earthquake risk in South Carolina. In fact, according to catastrophe research, all of South Carolina carries a moderate to high risk of earthquakes. Geologically, Charleston lies in one of the most seismically active areas in the eastern United States.

Earthquakes are not covered under standard U.S. homeowners or business insurance policies, but coverage can be added to most policies either as an “endorsement,” or by purchasing a separate, monoline policy to cover damage to a home and its contents caused by the movement of the earth.

Increases in risk and exposure to earthquake damage have led many insurance markets to evaluate reducing their earthquake exposures. Fortunately, earthquake coverage is still available in South Carolina. According to Robert Sanders Jr., Executive Vice President of Preferred Specialty, LLC, an MGA and Excess and Surplus Lines broker based in Columbia, “The excess and surplus lines market provides insurance solutions when there is a void in providing coverage in the standard insurance market.”

A recent poll by the Insurance Information Institute (I.I.I.) found that only 10% of American homeowners have earthquake insurance, compared with 13 percent in 2012.

“While the number of people buying earthquake insurance has declined, the potential cost of U.S. earthquakes has been growing because of increasing urban development in seismically active areas and the vulnerability of older buildings, which may or may not have been built or upgraded to current building codes,” said Dr. Robert Hartwig, CPCU, an economist and president of the I.I.I.

The South Carolina Insurance News Service provides the following facts about earthquakes:

All of South Carolina is considered to have a moderate to high risk for earthquakes.

A damaging earthquake could result in South Carolinians facing serious injury and property damage. Without earthquake insurance, individuals would have to pay for all damages to their home and possessions.

Earthquake is priced largely depending on the location and construction of your home. The average cost of earthquake coverage varies around the state. Earthquake deductibles apply separately from your basic homeowner’s (and business) policy deductible.

Consider retrofitting your home to make it more resistant to earthquake damage, like fastening a framed house to the foundation or fastening interior shelves securely to walls.

– South Carolina Insurance News Service

Comments

Notice about comments:

South Strand News is pleased to offer readers the enhanced ability to comment on stories. We expect our readers to engage in lively, yet civil discourse. We do not edit user submitted statements and we cannot promise that readers will not occasionally find offensive or inaccurate comments posted in the comments area. Responsibility for the statements posted lies with the person submitting the comment, not South Strand News.

If you find a comment that is objectionable, please click "report abuse" and we will review it for possible removal. Please be reminded, however, that in accordance with our Terms of Use and federal law, we are under no obligation to remove any third party comments posted on our website. Read our full terms and conditions.



South Strand News

© 2014 South Strand News an Evening Post Industries company. All Rights Reserved.

Registration on or use of this site constitutes acceptance of our Terms of Service, Privacy Policy and Parental Consent Form.
150-02-88705