Photo: 1994 Northridge, CA earthquake (spirit of america / Shutterstock.com)
20 years on from the Northridge earthquake, Californian economic losses from a quake of similar magnitude continue to far outstrip insured losses from such an event.
According to data from RMS, a 6.7 magnitude earthquake of the type experienced at Northridge would result in $155 billion worth of damage in California, but only $16-24 billion of insured loss. Northridge in 1994 resulted in $40 billion of economic losses and an insured loss of $12.5 billion.
In 1994 insured losses accounted for approximately 30 percent of economic loss. Today that figure has declined to approximately 15 percent, with California remaining remarkably under-insured.
RMS suggests that population growth in the state since 1994 has heightened the threat, as some 12 percent of the population that has entered the state since Northridge have theoretically never experienced an earthquake in California.
Northridge was the largest earthquake insurance loss recorded and a similar quake would top even Hurricane Katrina, which at $148 billion was the costliest natural catastrophe in US history.
RMS, earthquake, cat risk, California, US