Home News Local news Most V.I. Homeowners Are Insured Against Earthquakes, Officials Says

Most V.I. Homeowners Are Insured Against Earthquakes, Officials Says


Oct. 31, 2006 — The need for earthquake insurance has been a hot topic in the United States since the morning of Oct. 15, when Hawaii residents were jolted out of bed by an earthquake measuring 6.6 on the Richter scale.
However, it should come as good news to most V.I. residents that earthquake insurance is included in most homeowners' policies written in the Virgin Islands — unlike many places on the U.S. mainland.
"It's part of the standard policy," Deverita Sturdivant, who heads the Banking and Insurance Division at the Lieutenant Governor's Office, said.
She said hurricane insurance is also included in the package, but flood insurance is a separate policy.
While insurance against the ravages of hurricanes has long been on the front burner in the Virgin Islands, savvy residents know they also need earthquake insurance.
Lynne Shackell, a certified insurance service representative at Theodore Tunick and Co. on St. Thomas, said she sells three types of policies. The broadest one includes coverage for earthquakes and wind damage, but a cheaper policy is also available that excludes wind damage. A third type, excluding coverage for wind and earthquake damage, is even cheaper.
"Most people get the broad one because they have a mortgage," she said, noting that the broader policy is required by mortgage issuers.
She said that there were many variables when it came to cost, but insurers take into account the type of construction of the dwelling, the absence or presence of hurricane shutters and the roof's structural stability.
Jim Tunick at Theodore Tunick said the average cost for $100,000 worth of comprehensive coverage is between $2,000 and $2,500 annually.
Shackell said that in addition to earthquake, hurricane and windstorm damage, policyholders are also protected against fire, vandalism, malicious mischief, and lightning. Tunick said liability was also included in residential policies but not in those sold to businesses.
He said that property insurance is now readily available — unlike the years following 1995, when Hurricane Marilyn hit.
"We're not turning anyone away," he said, noting, however, that some companies do have limited capacity.
According to the Insurance Information Institute, the potential cost of earthquakes has been growing because of increasing urban development in seismically active areas and the vulnerability of older buildings, which may not have been built or upgraded to current building codes.
The institute's website also notes that on Oct. 23 property damage estimates for the Hawaii quake topped the $100 million mark. No deaths were attributed to this earthquake.
According to the insurance-rating agency A.M. Best, only 10 to 15 percent of homeowners on the mainland have earthquake insurance.
The Federal Emergency Management Agency calculated that in 2000, the last year for which statistics were available, earthquakes caused an estimated $4.4 million of property damage across the country.
Since Jan. 1, the Caribbean region has experienced 1,193 earthquakes, according to the website of the Puerto Rico Seismic Network. Most of them were not felt by residents, but a few did get the attention of people living in the territory.
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