Condominium Unit Owners Earthquake Protection Program

Real Estate > Programs > Condominium Unit Owners Earthquake Protection Program

Condominium Unit Owners Earthquake Protection Program

The Condominium Unit Owners Earthquake Protection Program was created to provide owners of high-rise condominium units with replacement coverage for the investment in their individual unit if the building suffers a total constructive loss due to an earthquake, and to compensate them for the cost of alternative housing caused by delays in rebuilding.

The program, offered through Alliant Insurance Services, was created as a solution to an earthquake insurance dilemma that is inherent with high-rise condominiums.

The Problem

Typically, owners of condominium units can only insure their contents, alterations, fixtures, and improvements (plus other ancillary coverages available in the homeowners policy) since the total building is usually insured by the condominium owners association. In most cases, associations only insure up to the probable maximum loss rather than the full value of the building, and in some cases even less. Although this enables the association to keep insurance costs affordable for unit owners, in the event of a constructive total loss to the building due to an earthquake, these owners face the possibility of:

Receiving payment from insurance proceeds that is much less than the value of their investment.
Having to pay for alternative housing for an extended period of time while their building is being rebuilt.
Losing their investment if the building is not rebuilt.

The Solution

The Condominium Unit Owners Earthquake Protection Program provides the owner of a high-rise condominium with the ability to insure against the following circumstances:

Inadequate Earthquake Limits—If the building is deemed a constructive total loss, unit owners receive payment for the insured value, allowing the owners to “cash out” their investment and use the money for any other purpose.
Substantial Delay in Construction Due to Contract Placement—If it takes more than 24 months to put a construction contract in place for rebuilding, unit owners will receive payment of 50% of the insured value for use in finding an alternate residence.
Additional Program Benefit—Twelve months after the date of loss, unit owners can claim $3,000 per month to be applied to renting an alternate residence for either 12 months or until the unit is inhabitable, whichever comes first.

Program Highlights

Premium is paid annually
Multiple locations can be covered on one policy
Coverage is for the peril of earthquake only

For more information, contact:

Rich Torres

(415) 403-1422

Kevin Miller

(602) 707-1918

The Specialty Leader Since 1925

Please select the service you wish to access, then log in.