Physical Sciences and Mathematics Commons^™

Earthquake Insurance: Mandated Disclosure And Homeowner Response In California, Risa Palm, Michael E. Hodgson

Geosciences Faculty Publications

Earthquake insurance can reduce potentially disastrous economic losses to house• holds and is therefore a prime method of mitigating against the worst economic effects of damaging earthquakes. The decision to purchase such insurance is a special case in the general study of individual response to uncertainty in the environment. An understanding of this decision process elucidates the ways in which environmental information becomes translated into behavior change. Although California legislation has mandated the disclosure of the availability of earthquake insurance to all residential property owners since 1984, less than half of California homeowners have earthquake insurance. This paper reports on …