Business and Finance

Archive for the ‘Earthquake Insurance’ Category

The whole world is experiencing climatic change, different countries all across the globe have experienced monstrous calamities. The freak rainstorm in Guandong China, major typhoons in Philippines, tsunami in Samoa and even the USA have experienced tragic calamities like Hurricane “Kathrina”.

California is home to many of destructive and devastating natural disasters from wildfires to earthquakes in the US. Because of this, Californians do precautionary measures to help them in the event of catastrophic national disaster. One of which is acquiring home insurance. Many home insurance agencies in California offer fast insurance quotes and even online quoting but how does one choose the right insurance agency? Some insurance agencies claim they have the “friendliest” home insurance quotes but before signing that agreement here are some tips to consider before choosing the right homeowners quotes. It’s all about the policies.

Make sure that the insurance agency has a wide and clear policy coverage. Take for example what has recently happened to the Philippines. A major typhoon has left many Filipino homeowners with home insurance that did not cover the mentioned calamity. Their homes were devastated by massive floods due to heavy rain but according to their insurance agencies flood due to heavy rain is an “act of god” which is not included in their list of policy coverage.

According to the department of insurance almost 90% of homeowners do not have earthquake insurance and California being prone to earthquake; it is highly advisable to make sure your home insurance covers such natural disaster. Damages which origin came from natural disaster are covered in certain insurance agencies’ policies however there are exceptions some of the significant ones are flood, earthquakes and poor maintenance. So if your home is based in earthquake and wildfire prone areas like in California, financial institution will ask you to purchase earthquake and wildfire insurance.

Find out if your home or possession will be insured for replacement cost or actual value amount.
Replacement cost is the exact amount to be used in repairing or replacing your home and possessions without deducting for depreciation while actual cash value is the exact amount after depreciation that will be used to repair or replace your home or possessions.

The owner’s copy of their insurance polices is very crucial in the event that they claim for their insurance. it is highly advisable to keep your copies safe. Avoid it from getting tampered or damaged as it might hinder your claim when the need arises.

Always contact your insurance provider whenever you appraise your home to update you policy accordingly.
Consult your insurance provider to confirm if your policy if covers additional living expenses for a temporary residence if your home is devastated from a disaster and you are unable to live in your home due to the heavy damage it received. This is very important especially to those homeowners who have no relatives living near California.

Most insurance agencies offer “friendly” home insurance quotes to lure prospects to acquire their insurance services. Bear in mind that before signing an insurance deal contract make sure that the insurance agency covers most of the possible contingencies that might cause damages to your home especially in natural disaster prone areas.

What are Retrofitting Measures?

Retrofitting are measures taken for older buildings to meet current codes by increasing its structural integrity to withstand moderate earthquakes with minor structural damage and major earthquakes with moderate structural damage. Retrofitting is your own decision at your own risk according to your financial situation as it may be costly. However, it may be addressed one step at a time starting by retrofitting the foundations; then bracing the cripple walls; followed by strengthening or bracing the first story if found to be a “soft story”; then anchoring or strengthening the connections of walls to the floors and roof; and finally bracing the masonry chimney

Why Retrofitting your Home?

Observations from past major earthquakes proved that the loss of property, level of structural damage, time and efforts required for repair and recovery, and cost of repairs as well as damage to contents and injuries are significantly reduced in buildings where retrofitting have been made. In addition, if you do not have an earthquake insurance, with your building not being retrofitted, most of the property damage caused by an earthquake will ends up being handled and paid for by you. Although some retrofitting measures may require assistance from a professional engineer, architect, or building contractor; however, other retrofitting measures can be done by you or someone who have skills in carpentering and home maintenance.

How to Retrofit your Home?

Retrofitting the Foundations

Upgrading Foundations’ Anchor Bolts or Steel Plates

Go down into the crawl space (the area between the first floor and the foundation) to find out if your house is bolted or plated to its foundation. Look for the heads of anchor bolts that fasten the sill plate (the wooden board that sits directly on top of the foundation, which is called the mud sill) securely to the concrete foundation, or for steel plates that are sometimes used instead of anchor bolts. Houses built before the mid 1990′s most likely have ½” diameter sill bolts with small, thin, round washers. If this is the case, you need to upgrade the bolt diameter to 5/8″ or ¾” depending on the size of your house. The bolts shall be placed at closer intervals no more than 6 feet apart in a single story and 4 feet apart in a multistory building. The edge bolt shall be placed ¾ to 1 foot to the end of the board. Although epoxy anchors cost more than expansion anchors, however, they are recommended in case of older houses with weaker concrete foundation. Larger, thicker, square washers should also be used as they are required by current building codes to anchor the sill from the top by clamping it down more securely to the concrete foundation. Studies estimate that the use of square washers increases the holding strength of the bolts to the mudsill by up to 60%. Foundation bolts may deteriorate over time, especially in houses having wet or damp crawl spaces. The observation of surface rust at the top of the bolts can be an indication of hidden problems if moisture gets trapped between the wood mudsill and the concrete foundation. In such case, the connection strength of rusted bolts to the foundation is severely reduced and you should consider bolt upgrading. Replacing or adding bolts to unsecured houses is one of the most important steps toward earthquake safety. This costs $250 to $5,000 and can be done by a contractor or by someone skilled at home maintenance. On the other hand, it may cost up to $25,000 to repair the foundation from earthquake damage (if your home is not destroyed) as the repair may require lifting the house, then placing it back on its concrete foundation.

Retrofitting Post-and-Pier Foundation

The outside of the house is supported by wood posts resting on unconnected concrete piers. Sidings are often nailed to the outside of the posts, but are not strong enough to brace the post-and-pier foundation. During an earthquake these posts may fail and the house would shift or collapse. Consult a registered professional engineer, a structural engineer, or a licensed foundation contractor for a suitable retrofit which include bracing the posts, or adding new reinforced concrete foundation and plywood walls in the crawl space. This costs $1,000 to $25,000 according to the retrofit measure.

Retrofitting Unreinforced Masonry Foundation

These are brick, concrete block, or stone foundations that cannot resist earthquake shaking and need to be replaced with a reinforced concrete foundation. Consult a registered professional engineer or a structural engineer to design the new foundation. This costs $15,000 to $50,000 and can only be done by a licensed foundation contractor.

Retrofitting the Cripple Walls

In wood frame structures, wooden floors and stud walls are built on top of an exterior foundation (short wood frame walls called cripple walls) to support the house and create a crawl space. These walls may collapse if they are not braced to resist the horizontal movement of an earthquake resulting in shift or collapse of the house. Go under the house through the crawl space to see if there are any cripple walls. If the cripple walls are covered on the exterior with only stucco (cement plaster) or wood siding, they are not strong enough to resist earthquakes. Older homes may have diagonal wood sheathing on the inside surface of the crawl space extending from the sill plate to the base of the floor joist. Inspect the conditions of the wood. If not good, retrofit according to the next paragraph. If the wood conditions are good, make sure that the diagonal sheathing is adequately nailed to each stud. Inspect the conditions and spacing of the nails. Add nails if necessary. Homes with cripple walls should have a minimum of 3/8 inch structural grade plywood panels on the inside surface of the crawl space extending from the sill plate to the base of the floor joist and adequately nailed to the studs. Metal brackets should also be connecting the rim joists to the top plates. You (if experienced in home maintenance) or a home contractor can strengthen the cripple walls relatively inexpensively, as it costs $500 to $2,500. On the other hand, it may cost up to $25,000 to repair after an earthquake, if your home is not a total loss.

Retrofitting the Soft Story

One important trait of typical home configurations in North America, Japan and elsewhere is to have more and larger windows and doors on the first floor than on the other floors. This results in what is called a soft story, where damage to the house is concentrated on the first floor. Numerous buildings, regardless material type, were severely damaged, leaned, or collapsed as a result of the “soft story” of the first floor in 1994 Northridge earthquake and 1995 Kobe earthquake. “Soft story” buildings lacking interior supporting walls are particularly vulnerable to earthquake damage, especially if there is living space above them. Examples are buildings with large openings in the external walls such as garage doors and windows, or with garage and parking spots on the ground floor. The narrow walls on either side of the large opening must be able to support the seismic load that is transferred from the roof and the additional living space above, if any, into the concrete foundation below. In order for these narrow walls to support the load, they must be properly braced. The garage door opening in sketch A is in line with the rest of the house where additional bracing may not be required. On the other hand in sketch B, bracing is most likely required. Bracing the walls of a soft story can be done by using steel bracing or specially-detailed plywood panels as recommended by a registered professional engineer, a structural engineer, a licensed architect, or a qualified building contractor specialized in seismic retrofit. The cost is $5,000 to $25,000 according to the retrofitting measure.

Retrofitting Masonry Chimneys

Masonry chimneys are a common problem as building codes before the mid 1990′s did not require homes with masonry chimneys to be reinforced or braced to the structure. In Northridge earthquake, 60,000 chimneys collapsed and caused serious damage and injury. Inspect your chimney for signs of significant cracking (greater than the width of a dime) along the mortar joints as well as ensure that mortar is in good condition and does not easily crumble when scraped with a screwdriver. A few adequately placed metal straps secured to the structural members (floor, ceiling, and roof joists) will help brace the chimney. Check with a home contractor to brace your chimney, which costs $2,000 to $12,000.

Retrofitting Inadequate Major Renovations

If you did major renovations to your home in the past, or if you decide to do at any time in the near future; contact a registered professional engineer, a structural engineer, or a licensed architect to ensure that all building code requirements are being met, and to determine that your new structure will have the ability to withstand earthquake forces. Such renovations include:

Replacing large portions of walls with windows or doors. Adding large skylights or additional stories. Opening large portions of existing floors, such as creating a two-story foyer. Additions that create an L-shape configuration.

Retrofitting Measures – One Step at a Time

The components of your home shall be secured to each other, so that they function as a single unit during an earthquake, transferring the forces from the upper stories through a continuous load path to the walls or braces then to the foundation. As discussed in the previous retrofitting sections, the earthquake damage will most likely be concentrated on the first floor because of the foundations, cripple wall, or soft story issues. Therefore, the best return on the investment of retrofit efforts is to initially address issues of the lower portions of the house then upper portions as follows:

Step 1 – Foundation: a) Add epoxy anchors or steel plates; b) Brace or replace the post-and-pier foundation; or c) Strengthen or replace the unreinforced masonry foundation. Step 2 – Brace the cripple walls. Step 3 – Strengthen or brace the first story if found to be a “soft story”. Step 4 – Anchor or strengthen connections of walls to the floor(s) and roof. Step 5 – Brace the chimney.

If you live in a Mobile Home

Mobile homes are prefabricated housing units that are trucked to the site and placed on isolated foundations, sometimes without any positive anchorage. Floors and roofs are constructed with plywood and outside surfaces are covered with sheet metal. Look under your mobile home. If you only see a metal or wood “skirt” on the outside with concrete blocks, masonry blocks, steel tripods, or jack stands supporting your home, you need to have an “engineered tie-down system” or an “earthquake-resistant bracing system” installed otherwise, your mobile home can be knocked off its foundations and damaged as well as breaking the utility lines.

If your Home is Rental

Although you have less control over the structural integrity of your building, but you do control which apartment or house you rent. Ask your landlord what measures have been taken to ensure the seismic safety of the building, and if you can secure furniture and water heater to the wall studs.

Concluding Remark

The 2010 Haiti earthquake is a wake up call for anyone who lives in an active seismic region to know how to reduce the risk to lives and investments by establishing an earthquake preparedness plan that include -among other items- retrofitting the structural components of the home including foundations, cripple walls, soft stories and chimneys. Seismic retrofitting measures will make your home safer and help in returning your family much more quickly back to their normal life style. In the United States, these seismic regions include -but not limited to- Alaska and the West Coast especially California; the Midwestern States especially Illinois, Kentucky, Missouri, and Tennessee around the New Madrid and the Wabash Valley Seismic Zones; and the Charleston area in South Carolina.

Additional information on how to secure the contents of your home including illustrative figures and photos can be found at http://hubpages.com/hub/earthquake-preparedness-and-retrofitting-measures

Are you trying to find homeowners insurance in California? If so, let me show you what you need to know first and where to find the best quotes online in California.

It is not required by law to have home insurance, but all financial institutions require that California borrowers purchase California home insurance when owning a home. The very basic California home insurance policies will cover fire damage, wind, lightning and major explosions. When getting your quotes online make sure to pay very close attention to the coverage that is provided.

Important, basic California home insurance policies do not cover floods or earthquakes. In this case you need to look into getting two additional California home insurance policies. These policies or so called “special coverage policies” which are offered at a different rate.

It is is crucial that when searching for flood insurance you consider the average time it takes them to pay claims. When obtaining your quote you will be provided with this information.

Although it can cost more, earthquake insurance is definitely a must have in California. Earthquake insurance will cover the replenishment of property damaged. California home insurance companies are to cover damage to the structure of the home and expenses for temporary housing.

California home insurance companies have the right to charge higher earthquake insurance premiums when a house is old or appears more likely to be destroyed by an earthquake. The construction of your home is crucial, as wood homes are much cheaper to cover. Insurance companies also include the location of a house when determining your premium rates. Hence, if you live near the fault line you are going to pay a lot more.

When choosing a California home insurance company get several quotes online first. This makes your decision much easier and more informative. Your cost will depend on several factors, like the ones which were discussed.

The cost of treatment for dental problems has increased. The need to take a dental insurance has now become important, as a dental insurance covers all sorts of dental problems. This insurance includes problems that are caused due to cavities, or damage to teeth due to an accident or a fall. People prefer dental insurance, as it is very flexible and can be adjusted according to the need and requirement of the situation.

Insurance companies generally cover the costs or two dental routines in a year. Minimal treatments like cleaning of the teeth, or even a filling are also covered under the dental insurance plans. This reduces the risk of people getting major treatments like a root canal, or a crown filling, as a result of regular check-ups. For families with children who have cavities, dental insurance is a must and is economical, considering the rise in the consulting fees of dentists. There are many expenses that the head of the family has to take care of, hence insurance for life, health, and dental care are a must for all.

Many of the companies provide free dental insurance, for their employees as well as their families. There are also other companies that offer dental insurance only to individuals. For an individual the process is simple, as a form needs to be filled and the treatment procedure takes place. But in the case of family dental insurance, it is a lengthy procedure as the claims take a lot of time to clear. The claim money is either given at one time, or not given for months at a stretch.

As the years pass by, the limits on dental insurance keeps rising higher. This is because if the price of care goes beyond a limit, the dental insurance companies do not cover the treatment-related expenses. Families generally take group dental insurance policies, as they are cheaper and more beneficial. Hence compared to the individual annual premium, family dental insurance premiums are lower.

Dental insurance plans for families are a very economical way to save up for other expenses. There are many dental insurance companies that offer insurance at low premiums, so families can choose the one that suits their needs.

There are two types of insurance in particular that you should consider if you are a home owner. These are flood insurance and earthquake insurance. Of course, this is not for everyone, but if you live in an area where either of these is highly relevant, acquiring either of these is a solid investment. However, if you are living in an area that is prone to floods or earthquakes, it is important to understand that most property policies will not cover these disasters. On the flipside, some independent carriers in fact offer both. For flood insurance, you can also contact the National Flood Insurance Program if you cannot find a provider which covers flood insurance. In California, you can obtain earthquake insurance through the California Earthquake Authority.

Flood insurance represents the specific insurance coverage against property loss from flooding. To settle on the risk factors for specific properties, insurers will often look at topographical maps that refer to lowlands and floodplains that are at risk for flooding. Insurers in the US do not provide flood insurance coverage due to the hazard of flood typically being confined to a few areas. Because of this, it is an objectionable risk because of the inability to extend the risk on a broad enough populace to suck up the latent disastrous nature of the vulnerability. As a result of this, the federal government formed the National Flood Insurance Program in 1968.

Some states only have one type of natural disaster, and that is the earthquake. For this reason, it is highly recommended that you invest in earthquake insurance if your state is prone to this natural disaster. Most likely the most imperative thing to recognize about earthquake insurance is that a basic homeowners policy will not cover earthquake damage. But even if you do not live in an area where earthquakes are common, it is possible that you might need earthquake insurance.

Every year, more homeowners get rid of their earthquake coverage than buy it because, according to end user groups, consumers carry the belief the policies cost too much and cover too little. Earthquake insurance can be quite inexpensive depending on where you live. It is a good idea to contact your insurance agent or company to find out what the costs would be for your home.

Not surprisingly, Californians buy the most earthquake insurance, but earthquake insurance has been sold to residents of all 50 states. But earthquake insurance is not like health insurance or auto insurance. It is catastrophic insurance. It is what insurance was invented for in the first place, which is for protecting yourself against a destructive financial loss that will come to pass at some point in the future, even if it is not to be in your lifetime.

Is it available, and is it too pricey? That depends on the insured value of your home, the location of your home, and the age and construction type of it, in addition to your delivery service and your deductible. Either way, those are the facts, and now that you are equipped with the knowledge, it is now a little easier to know whether you should invest in either flood or earthquake insurance.

If you reside in an area prone to earthquakes, have equity in your home, and you couldn’t afford to rebuild it on your own, buying earthquake insurances makes financial sense. If you can afford it, the best way to protect the investment in your home is to retrofit your home and buy earthquake insurance. The more steps you take to retrofit and improve your home’s ability to resist the impact of an earthquake, the less likely you are to face expensive repairs. Retrofitting your home includes, bracing your water heater, installing “sheer” panels and bolting your foundation. If you decide that your home needs protection beyond retrofitting, then shopping for earthquake insurance is your next step. Several key factors you should consider and research as to whether you buy insurance or not are:

The amount of equity you have in your home.
Your current proximity to a fault zone.
The construction and age of your current home.

The satisfaction ratings and financial strength of the insurance companies that will potentially sell you an earthquake insurance policy Earthquake insurance policies are usually accompanied by high deductibles and premiums. When the time comes to receive any benefits under your insurance policy, your claim needs to exceed your set deductible. Most homeowners and auto insurance policies have a fixed dollar amount deductible. Earthquake policies are different, their deductible is a percentage figure based on the total policy amount. The damage to your home or structure must exceed your deductible to trigger a payment from your policy, and the payment will be the amount of repair costs above your deductible. So on a home with $500,000 of coverage, and a 15% deductible, the homeowner will be expected to cover the first $ 75,000 of repairs. Your carrier will determine your premium. Usually older homes cost more to insure than newer homes and retrofitting is required for homes built before 1955. Premiums should not be the only thing you take into consideration when you are purchasing an earthquake insurance policy. Often you can find policies with low premiums, but they are accompanied by poor coverage.

One important thing to keep in mind when shopping for earthquake insurance is that the insured value of your house is determined by your homeowners insurance. If you are under insured on your homeowner’s policy, you will also be underinsured on your earthquake policy. Purchasing earthquake insurance can be a difficult decision. People who live in the Bay Area of California have a 75% chance of a 6.0 magnitude or greater earthquake hitting them, but only about 14 % of CA residents carry earthquake insurance. If you decide to buy earthquake insurance, place your limit so that it is adequate to completely replace your property, any outbuildings, cover any engineering costs, and temporary living expenses that you may have.