Insurance News

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February 25, 2010

Missouri Department of Insurance: Earthquake insurance market feeling some tremors

Jefferson City, Mo. - February is Earthquake Awareness Month, and Missouri Insurance Director John M. Huff says earthquake insurance is available across the state, but with some significant shortcomings in coverage. A new survey shows that while homeowners in all parts of Missouri can find coverage, they may face extremely large deductibles or have to leave their current homeowners insurance company.

The department recently collected data on earthquake coverage from the 20 largest homeowners insurance companies in Missouri. The report showed several positives, including the availability of coverage and the relative affordability of premiums. In most parts of Missouri, the insurance will cost about $10 per month on a $200,000 home. In St. Louis and southeast Missouri - areas most likely to be affected - the insurance averages about $40 per month.

Huff, however, says he's concerned about several findings:

"The huge deductibles and other issues mean consumers, who have faithfully paid their premiums for years, could face extraordinary difficulty should a damaging earthquake hit their region," said Huff. "Missouri needs homeowners insurance to be available without undue restrictions, so that insurers can truly come through for consumers should such a life-changing event occur."

Huff says earthquake insurance policies have become more restrictive in recent years, and the department will continue to watch the market for developments.

The top 20 homeowners insurance companies represented more than 80 percent of the Missouri homeowners market in 2008. A list of companies offering earthquake insurance to new customers is available at the department's Web site. Consumers interested in buying coverage should shop around, and those who already have coverage should talk to their agents to ensure they understand what they're paying and what they're getting.

Consumers with insurance questions or complaints can contact the Missouri Department of Insurance online or at 1-800-726-7390.

About the Missouri Department of Insurance, Financial Institutions & Professional Registration

The Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP) is responsible for consumer protection through the regulation of financial industries and professionals. The department's seven divisions work to enforce state regulations both efficiently and effectively while encouraging a competitive environment for industries and professions to ensure consumers have access to quality products.

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