The insurer wants to increase its typical premiums by 30 percent, to $762 annually.
The Orange County Register
The California Department of Insurance will hold a hearing on whether to approve Safeco‘s proposed 30 percent increase for earthquake insurance.
The $175 increase would raise the typical Safeco annual premium for policyholders from about $587 to $762, according to Safeco spokesman Eric Trott.
Seattle-based Safeco, the 10th-largest earthquake insurer in California, has about 50,000 homeowners statewide who buy its earthquake insurance, Trott said.
The increase would put the company in line with rates offered by the California Earthquake Authority, the state’s largest earthquake insurer that is a privately funded government agency, Trott said.
No date is set for Safeco‘s hearing. It’s a response to a challenge by the nonprofit Foundation for Taxpayer and Consumer Rights, said Lawrence Markey Jr., a lawyer for the group. Safeco submitted the request to the Insurance Department in August.
Markey Jr., who calls Safeco‘s proposed increase excessive, says: “No increase is warranted. They’re making a fair return.”
Earthquake insurance is unpopular because it is considered expensive coverage with high deductibles. Just 13.3 percent of all California homes had earthquake coverage as of last fall, down from 17 percent in 2002, according to the Insurance Department.
If insurers like Safeco make coverage more costly, it may deter even more people from getting protection from the next earthquake, Markey Jr. said.
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