Insurance News

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February 22, 2011

Department of Insurance: Missouri consumers not being protected with earthquake insurance

Fewer homes covered, prices going up

Jefferson City, Mo. - On the 200th anniversary of the great New Madrid earthquake, Missouri's insurance director says most homeowners would not be adequately protected from an earthquake today. John M. Huff, director of the Missouri Department of Insurance, says the number of consumers with earthquake coverage on their homes has decreased sharply over the past 10 years. At the same time, the cost of earthquake insurance has increased drastically, doubling in several counties.

"Most homeowners insurance policies don't cover earthquake damage - instead, consumers need to buy an endorsement, sometimes called a rider, on their homeowners policy." Huff says data submitted to his department shows that in areas at highest earthquake risk, fewer consumers' homes are covered by those endorsements.

 

County

Residences covered, 2002

Residences covered, 2009

Premium increase, 2002-2009

St. Louis City

48%

36%

27%

St. Louis County

73%

63%

17%

Dunklin

54%

37%

118%

Mississippi

56%

45%

85%

New Madrid

51%

43%

111%

Pemiscot

51%

32%

102%

Scott

69%

55%

125%

Stoddard

63%

49%

38%

A year ago, Huff expressed concerns that even consumers with earthquake coverage were not adequately protected because of large deductibles that could leave homeowners paying $50,000 or more out of pocket, depending on the value of the home. Traditionally, the shortcomings in coverage have been limited to southeast Missouri, but now are starting to spread to St. Louis.

"The products offered by insurance companies are not meeting the needs of Missouri homeowners when it comes to earthquake protection, and it's now affecting our largest metropolitan area," said Huff. "Earthquake preparedness will be a major topic in our state in the coming months, and the scarcity of solid insurance products needs be included in that discussion."

February is Earthquake Awareness Month, and the State Emergency Management Agency offers earthquake preparedness resources on its website, as well as a schedule of planning activities over the next few months.

The Department of Insurance website offers a list of the major homeowners insurance companies in Missouri that offer earthquake coverage.

Consumers and questions complaints about insurance can call the Insurance Consumer Hotline at 800-726-7390 or visit insurance.mo.gov.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

County

 

 

 

Residences covered, 2002

 

 

 

Residences covered, 2009

 

 

 

Premium increase, 2002-2009

 

 

 

St. Louis City

 

 

 

48%

 

 

 

36%

 

 

 

27%

 

 

 

St. Louis County

 

 

 

73%

 

 

 

63%

 

 

 

17%

 

 

 

Dunklin

 

 

 

54%

 

 

 

37%

 

 

 

118%

 

 

 

Mississippi

 

 

 

56%

 

 

 

45%

 

 

 

85%

 

 

 

New Madrid

 

 

 

51%

 

 

 

43%

 

 

 

111%

 

 

 

Pemiscot

 

 

 

51%

 

 

 

32%

 

 

 

102%

 

 

 

Scott

 

 

 

69%

 

 

 

55%

 

 

 

125%

 

 

 

Stoddard

 

 

 

63%

 

 

 

49%

 

 

 

38%

 

 

 

 

 

 

A year ago, Huff expressed concerns that even consumers with earthquake coverage were not adequately protected because of large deductibles that could leave homeowners paying $50,000 or more out of pocket, depending on the value of the home. Traditionally, the shortcomings in coverage have been limited to southeast Missouri, but now are starting to spread to St. Louis.

 

 

"The products offered by insurance companies are not meeting the needs of Missouri homeowners when it comes to earthquake protection, and it's now affecting our largest metropolitan area," said Huff. "Earthquake preparedness will be a major topic in our state in the coming months, and the scarcity of solid insurance products needs be included in that discussion."

 

 

February is Earthquake Awareness Month, and the State Emergency Management Agency offers earthquake preparedness resources on its website, as well as a schedule of planning activities over the next few months.

 

 

The Department of Insurance website offers a list of the major homeowners insurance companies in Missouri that offer earthquake coverage.

 

 

Consumers and questions complaints about insurance can call the Insurance Consumer Hotline at 800-726-7390 or visit

 

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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