Providing Residential Earthquake Insurance and Mitigation Programs to the State of California

The 1984 California Mandatory Offer Law required insurers to offer earthquake insurance as a condition of participating in the California residential insurance market. After suffering unprecedented insured losses from the 1994 Northridge earthquake, almost all California residential insurers stopped selling homeowner’s insurance throughout the state. California’s legislature stepped in with a solution in 1996 by creating the California Earthquake Authority (CEA), a “public instrumentality” of the state. Through its participating insurers, the CEA provides more than 66% of the residential earthquake insurance market in California. However, nearly 90% of California homeowners do not have earthquake insurance. With a strategic plan to Educate, Mitigate, and Insure Californians, the CEA endeavors to change that. …