Editor:
The postal code of one's home can decide the cost of earthquake insurance and the limitations of coverage. The disasters in Japan, New Zealand and elsewhere during the past year have caused the insurance industry to introduce stricter terms for this essential coverage.
It is interesting that only about half of B.C. homeowners actually buy earthquake insurance, despite the continual forecasts that we are overdue for the "big one."
We are required by law to insure our cars for liability to a minimum level, yet although an earthquake in B.C. will involve huge financial cost for many homeowners, and governments, there is no consideration being given to the need for a better method of risk protection than the existing hit or miss situation.
Why should taxpayers pay out disaster relief to those who have chosen not to insure?
Surely we could introduce a requirement for homeowners to buy earthquake insurance if they live in a threatened region?
Right now the insurance industry has adopted an arbitrary assessment of risk based on address and postal code. As a matter of interest, if you live east of 56th Street in the V4L postal code area, the earthquake insurance premium is 26 per cent dearer than if you live in the V4M area west of 56th Street. Also the best deductible obtainable in the V4L areas is 10 per cent, whereas in V4M it can be five per cent.
In some areas of Richmond it is not possible to obtain coverage. I wonder what sort of insurance penalty would be assessed for new homes constructed in the Southlands, which is at present shown as V4L?
This area is low lying, and sits on land subject to liquefaction. No amount of fill will correct the underlying saline tidal pressures.
To save administrative expense the insurers have adopted a crude method that is, of course, open to much criticism. We all know how some major illogicality exist from this.
We need a realistic compulsory provincial insurance scheme to cover earthquake risk to protect all concerned. This could be run by the insurance industry, not ICBC. We should resist lines drawn on postal code maps as the arbiter of risk.
I would like to reveal an interest here. My postal code is V4L, yet I live in the V4M area. Think about it.
Peter Duffey
