I wonder why lenders require fire and flood insurance but not earthquake?
I wonder why lenders require fire and flood insurance but not earthquake?
That’s a great question!Originally Posted by Pieter
Because nobody could realistically afford the insurance, even if insurers were willing to gamble the level of risk if routinely mandated. It makes vastly more sense simply to exclude development from high risk sites, but that's often exactly where developers choose to build because the land is discounted. And at times, it seems that the no. 1 routine source of cash flow in certain counties is developer bribes. Certain public officials will go out and themselves deliberately acquire worthless or high risk acreage cheaply, knowing full well in advance they are going to flip it to an unscrupulous developer. The FBI long had a branch of agents bagging local politicians involved in that kind of activity, and got plenty of convictions, but couldn't begin to keep up with the sheer scale of it in places like California, Arizona, and Florida.
I happen to have a research background in geomorphology, from back when there were almost no careers in it. But a nephew of mine makes a good living at it. But a very probable, even common, application of this would be for a developer to approach you and ask for a risk assessment of what would happen if he put a subdivision atop a leveled-off portion of a known land slump area. Not kidding, I'd could look at the location, tell em it would be insane to build there, and the USGS would say the same thing, and the developer would behave in a very friendly manner, thank me, hand over a $2,000 check, and then go pay each of the county supervisors or city fathers at least that much apiece, and build there anyway. It happens so often it's ridiculous - I've seen entire subdivisions slide off hillsides, even into reservoirs down below. It's entirely predictable, just like repetitive flooding of subdivisons built in old river beds, or repetitive catastrophic fires in areas where the brush is designed by natural genetics itself to periodically burn. Duhhh.
Developers come up with custom expert reports claiming it would take a "once in a 500-year flood, or once in a thousand year flood" to knock their streambed or riverside development out. But I've seen those once in a millennium floods happen to the same riverbed five years in a row! The name given to those compromised science degree "experts" tweaking enviro studies for sake of their developer employers deservedly goes like, "Geostitutes", "Biostitutes" - they sold themselves.
and they blame those disasters on climate change!
Lenders do mandate fire and flood insurance. And you go on and on about the cost of earthquake insurance. It's not cheap, but not as outrageous as you seem to make it out to be. https://www.earthquakeauthority.com
Maybe because 100 year fires and 100 year floods come every 25 years now.
They have been requiring that coverage for as long as I can remember.
Wrong; now 100 years fires come 25 times every year! And that's an understatement. There is evidence these fires are already getting worse than anything detectable for several thousands of years past, except for volcanic events.
Yes Ron, human induced climate change is a VERY REAL factor in all this. It's the four ton elephant right in the middle of the living room, impossible to miss. And it is getting worse at an alarming rate. One example would be the millions and millions of pine trees killed by pine beetle infestations due to ongoing unusually warm winters. Right up the canyon from my former living room view it looks like two dozen atomic bombs had gone off. The thermal fire cloud in there last year actually went higher than any nuclear mushroom cloud, and sent its ash clear across the country and even all the way to Europe.
But it is also true that very unwise land policies and and unwillingness to bend cultural customs have exacerbated all this. God gave us common sense for a reason; and if we violate that, we have nobody to blame but ourselves. Farming land within levees might make sense, but building subdivisions there does not. If there are new cracks routinely within the street and frequent drainage pipe failures, common sense would have you check a geologic map to see what is actually going on; but realtors don't like you to know those even exist. How do you cure the flooding of New Orleans once for all, after twenty or more major flooding incidents over the past century? Simple. Move. It's inevitably going to happen again. Want a nice Florida beachfront investment? Look fifty miles inland, cause that's where the shoreline will be soon enough.
So just how long can insurance companies themselves survive, or even Fed emergency funds, if there aren't significant land use changes, and quickly? Everyone in this state is complaining about a shortage of affordable housing; but how do you get that when houses need to be better and more expensively built in order to resist fires, or surrounded by even more defensible space? There is no free cigar anymore, just hard choices. The Enviro Credit Card is maxed out and overdue; and now it's time to pay up. Nobody is going to outrun it. Too late. The whole planet is affected, with exceptional fires, droughts, and extreme heat waves many places, not just here - elsewhere the reverse, with more frequent hurricanes and floods.
Right this moment there are two thousand year old giant sequoia trees dying that have survived hundreds of fires before.
In fact, their bark is so thick that ordinary forest fires have repeatedly moved right past them with only minor effects. But not anymore. Now flames are so high they reach over 100 feet up and into the very crowns of these giant trees and spread crown to crown, destroying them from above. There is no evidence from tree ring studies etc that this kind of thing ever happened before.
There is a huge struggle going on to protect as many sequoias as possible, but nobody knows the exact extent of the loss until the smoke clears and people can get to the remoter groves. This is now within Sequoia National Park, in a number of those very groves of the largest trees on earth so many travel to, to see and photograph; and the overall fire is only 11% contained. Plus the surviving trees still need to find enough water to sustain their tremendous mass - another worry in extreme drought conditions. The handwriting is on the wall. Things aren't the same at all.
Last edited by Drew Wiley; 5-Oct-2021 at 14:20.
I am looking at a CA Farmer's Policy, which I imagine is essentially the same as those used in many states. Here's how you analyze it -- you don't need a lawyer for this:
1. Look at the Declarations up front. There is a coverage (in this case it is "C") called "personal property." The limit there given in $$ is how much insurance you potentially have for all your stuff. If every single thing in your house destroyed, this is the most you can get. If you have replacement coverage it should be indicated here too. You absolutely want that.
2. Skip ahead to "types of property insured," then look down at Coverage C. It tells me they cover property I own OR USE (isn't that interesting?) "anywhere in the world." So those of you saying that stuff stolen out of your hotel room, car, etc. isn't covered are wrong based on this policy. If a fellow astronaut steals your stuff on the ISS you're out of luck; otherwise, you're in great shape if you stay on this planet. If someone is visiting you and their stuff gets stolen from your residence, that stuff is covered too, provided they aren't a tenant, boarder, etc.
3. Right under the description of Coverage C is the next section that might matter, "Special Limits on Certain Personal Property." As to the types of stuff listed here, there is insurance, but it is limited to maximum coverage of $28,000 to $150, depending on what it is. These reduced limits apply to jewelry, watches, precious stones, furs, guns, "business property" [$1500 limit], cash [$150], cashier's checks, precious metals, stamps, valuable papers, silverware, goldware, rugs, carpets, comic books and collectible cards, trailers and boats. Nothing here about camera equipment used for non-business purposes, so the full property limit applies.
4. Almost done, there is one more section which covers "types of personal property not insured," which means things for which you have ZERO coverage. Nothing given there would involve photographic stuff -- it more kind of oddball stuff. Your dog and other "creatures" are not covered at all. No coverage for lawn mowers or tractors. No coverage for aircraft or "self-propelled missiles."
That's it.
Keep a list of your camera stuff with serial numbers. Take photos of it. If you can document your losses you're going to get paid.
My Amica policy is similar in many respects; I believe it's somewhat standard. But some things to be aware of:
- damage due to flooding may not be covered
- the coverage limit for personal property not at the principle residence (for example, at a hotel) is lower
I like to take photos of the item and of it's serial number. I feel a photo is stronger evidence that you actually possessed the item. Particularly as so much of my equipment was purchased used and, when bought as a package, not itemized.
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