NAII Protests Calif. Earthquake Bill

May 17, 2000

A new earthquake bill would invite an avalanche of claims, the National Association of Independent Insurers (NAII) said yesterday. Senate Bill 1899 lifts the statute of limitations that would otherwise bar plaintiffs from filing claims resulting from the 1994 Northridge Earthquake.

NAII testified against SB 1899 at a hearing before the Senate Judiciary Committee. “SB 1899 would allow homeowners who either negligently or intentionally have failed to file a claim to now, more than six years later, file a claim for coverage,” said Sam Sorich, vice president and western regional manager for NAII. “The bill is an invitation for fraud. It places insurance companies in the impossible position of trying to determine whether damage claimed now was really caused by a 1994 earthquake.”

Although SB 1899 might provide benefits to some claimants, Sorich said the costs of the bill’s “unfairness and uncertainty would be borne by all insurance consumers.”

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