Dozens of Bay Area homes are in danger of destruction by landslides, mudslides and voracious sink holes, and many of their grieving owners are discovering that the damage is not covered by their insurance.
You can't recover a penny in landslide or sink hole damage unless you buy a special landslide policy from Lloyds that only became available in California on January 1. Nobody has bought one yet.
Mudslides are only covered by flood insurance offered by the federal government.
With a mudslide, muck and mire are carried by floodwaters along the surface of the land, and may wind up in your basement or living room or all over your house. That isn't covered by a landslide policy.
In a landslide, the earth crumbles, falling on your home or causing your home to fall. That isn't covered by flood insurance.
Landslides and sink holes -- where the earth caves in and swallows a home -- are only covered by the new commercial policies, but they're expensive. The cost is 40 cents per year for every $100 of coverage -- or $1,200 on a $300,000 house.
David Benesh, a spokesman for Insurance Brokers of America West, said it's expensive because landslide damage ``is usually catastrophic. The insurer is replacing the whole home nine times out of 10.''
In recent years, landslides have caused an average of $100 million worth of structural damage in California, according to David Howell, a spokesman for the U.S. Geological Survey. That includesdamage to commercial buildings, bridges and highways as well as homes. There are no figures available for homes alone.
USGS says that perhaps half the North Bay and East Bay are highly susceptible to landslides because of hills and soil conditions. Santa Clara County is somewhat less susceptible, while the threat is only spotty in San Francisco and San Mateo County.
Early this week a landslide crashed into and destroyed a house on Green Glen Way in Tamalpais Valley in Marin County. The same day, a house undermined by a landslide on Snake Road in Oakland was demolished. Homeowners insurance paid for the demolition, but not the house.
As the storms continue, many dozens of other hillside homes are being evacuated because of possible landslides.
If your house is obviously about to plunge, it's too late to get landslide insurance. It takes five days before the policy becomes effective. During that time, the insurers will send a technical team to examine the property. They will check the condition of the land, the foundation and any retaining walls, and the effectiveness of the drainage system.
Lloyds will only sell policies in neighborhoods where there has been no previous landslide damage, says George Orr, a manager with the Montgomery & Collins insurance brokerage in San Francisco, which is marketing the policies.
You can apply for a policy through many independent insurance agents. Or, you can call Montgomery & Collins at (415)398- 7437.
Standard coverage goes up to a total of $1 million for house and contents. But policies are available up to $5 million and beyond if the underwriters agree.
If your home isn't located on or beneath a hill, and if it is built on firm soil, then you probably won't need landslide insurance.
But you still may need federal flood insurance, which covers several types of damage that a standard homeowners policy doesn't.
Flood insurance covers up to $250,000 in structural damage to a home, and $100,000 in damage to the contents. It is available through any agent who sells homeowners insurance.
The cost varies depending on location, from $280 per year in a low-risk zone to almost $600 in a high-risk area per $100,000 of coverage.
For renters, flood insurance costs $75 a year, plus fees for contents coverage starting at $245 for $50,000 worth of coverage.
Damage from falling water -- to roofs, windows, floors or furniture -- normally is covered by a homeowners policy, notes Candysse Miller, regional manager of the Western Insurance Information Service.
However, damage caused by rising water is considered flood damage.
Only a flood policy will reimburse you if a creek overflows and inundates your home, or a mudslide winds up in your master bedroom, or your basement turns into a quagmire because the surrounding soil can't absorb moisture.
If your home is burglarized after it has been flooded and evacuated, your homeowners insurance should cover the theft. And if a storm knocks a tree onto your house, homeowners insurance will pay for the damage and for removal of the tree from the property.
However, if the tree doesn't cause any damage, you will have to pay the cost of removal yourself.
Some people are required to buy flood insurance. If you live in what the federal government considers a flood-hazard area, federal law requires you to buy the insurance before you can get a mortgage from a federally insured or regulated institution, such as a bank or a thrift.
However, flood insurance is not available in 28 California communities that are considered low risk, among them San Francisco, Carmel and Pacific Grove, according to Jack Eldridge, a coordinator of the flood-insurance program with the San Francisco office of the Federal Emergency Management Agency.
Some people don't bother to insure their homes against catastrophic losses, assuming the federal government will bail them out in case of a disaster.
But the government provides funds only if the afflicted region is declared a disaster area by the U.S. president. In that case, FEMA provides only small amounts of aid, usually in the form of low-interest loans, for temporary living expenses and minor repairs.
There is only one landslide-insurance program available to California residents. It is marketed by Montgomery & Collins, a San Francisco insurance brokerage, and underwritten by Lloyds, the international specialty-insurance syndicate.
-- Coverage: Normal coverage up to $1 million total for home and contents. Special coverage up to $5 million and perhaps more if underwriters agree.
-- Deductible: 2.5 percent of the home's value -- $7,500 in the case of a $300,000 home.
-- Cost: $400 per year for each $100,000 of coverage.
-- Waiting period: Insurance takes effect five days after the application is approved.
-- Eligible properties: Dwellings owned by the occupants, with effective drainage systems, and with no previous landslide damage either to the home or neighboring properties.
-- How to apply:
Many independent insurance agents can handle the transaction,
or you can call Montgomery & Collins at (415) 398-7437.
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