3.6 Magnitude Missouri Temblor Shows Need for Quake Insurance, Regulator Says

No damage was reported from a magnitude 3.6 earthquake in southeast Missouri on April 1, but the state’s insurance director says it night illustrated the need for earthquake insurance coverage

The quake occurred at 10:51 p.m. and was centered near Steele, Mo., according to the U.S. Geological Survey

Shaking was felt in six states — Missouri, Illinois, Arkansas, Kentucky, Tennessee and Mississippi. No injuries were reported.

Southeast Missouri is part of the New Madrid Fault, where significant earthquakes in 1811 and 1812 were so strong they could be felt in New England.

“Our analysis indicates that more than 80 percent of Missourians in the New Madrid Seismic Zone do not have earthquake insurance coverage,” said Missouri Department of Insurance Director John M. Huff. “The lack of insurance coverage could seriously jeopardize property owners’ ability to recover from a more significant earthquake event.”

The Missouri Department of Insurance recently completed an earthquake survey of insurance carriers that provide 83 percent of the homeowners market share in Missouri.

It found that six out of the top 21 carriers do not offer earthquake coverage. Twelve out of the top 21 carriers do not write earthquake coverage in the New Madrid Seismic Zone (NMSZ) which includes the counties of: Dunklin, Mississippi, New Madrid, Pemiscot, Scott, Stoddard and contiguous counties of Bollinger, Butler, Cape Girardeau, Carter, Madison, Perry and Ripley.

Of the nine insurance carriers who do offer earthquake coverage in the NMSZ, four require minimum deductibles of 20 percent, three do not insure masonry homes and three had premium increases since the department’s 2014 survey. Two companies have since stopped writing coverage in the NMSZ.

Since 2005 rates in New Madrid County have increased by over 250 percent, 122 percent in Pemiscot County, 118 percent in Mississippi County, 177 percent in Scott County and 107 percent in Dunklin County. Between 2000 and 2014 the number of insurers offering coverage in the state has also declined by nearly 30 percent.

Topics Catastrophe Mississippi Missouri