Two back-to-back earthquakes that recently jostled Northern California weren't powerful enough to cause serious injuries or damage. But they were a reminder of the looming danger of big earthquakes in the Golden State and the need to consider earthquake insurance. The magnitude 3.5 and 4.0 quakes struck eight seconds apart at about 5:30 a.m. March 5. They were centered in El Cerrito, about 10 miles from Oakland in the San Francisco Bay Area. The temblors were puny compared to what's likely to come. In a 2008 earthquake forecast, scientists said the chance of a 6.7 magnitude or greater earthquake in California by 2028 is more than 99 percent. Experts from the U.S. and California Geological Survey and the Southern California Earthquake Center compiled the forecast. Scientists say the greatest probability for a big one is in the region around Los Angeles, which faces a 67 percent chance of experiencing a major earthquake by 2028. The chance of a big one hitting the San Francisco Bay Area is 63 percent. The most recent big ones The last big one to hit California was the 6.7 Northridge earthquake in 1994. The earthquake killed 57 people, severely damaged or destroyed 4,000 buildings and… (continue reading......)
The catastrophic earthquake that struck central Chile last week is estimated to have caused billions of dollars in insured and economic losses. Insured losses are being estimated between U.S. $2 billion to $8 billion and total economic losses may cost between U.S. $15 billion to $30 billion. If it wasn't for the highly developed insurance market in Chile, economic recovery would be much more difficult. In addition to a number of its own insurers, Chile also has many large international insurers and reinsurers (mainly American and European) that will provide the financial resources necessary for Chile's reconstruction, according to the Insurance Information Institute (III). That makes Chile's situation much different from Haiti's, which was struck by a devastating earthquake on Jan. 12. Haiti has almost no private insurance market. According to III, direct premiums written in Chile in 2008 totaled roughly U.S. $5.8 billion. Of that, nonlife (i.e. coverage on homes, businesses and vehicles) insurance premiums accounted for U.S. $2.3 billion and life premiums U.S. $3.5 billion. By contrast, in Haiti, estimated total nonlife premium income written in 2008 was $19 million. Makes you wonder how different recovery would be for Haiti if it had a stronger insurance market. Unfortunately,… (continue reading......)
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