Oklahoma general insurance agency Midlands Management is adding earthquake deductible buy-down insurance as a means of making the cost of recovering from earthquake damage more manageable for property owners, according to Oklahoma insurance commissioner John Doak.
Quoting the new coverage for interested consumers will be started immediately by Midlands Management, which already offered standalone earthquake coverage for commercial risks.
Commissioner Doak said he had spoken extensively with Oklahomans affected by the recent, record earthquake, and one of the common complaints expressed by property owners were the high deductibles sometimes associated with earthquake coverage.
"While the annual premiums for earthquake insurance can be very affordable, some consumers who considered coverage in the past said they decided against it because of the deductibles," Doak said.
Doak notes that despite a high deductible, earthquake insurance could still be a wise financial choice.
Midlands Management’s new coverage is supplemental insurance for property owners who already have earthquake coverage through any company, and could mitigate a policyholder’s out-of-pocket cost for the deductible at a time of loss.
Midlands Management can be contacted by any licensed agent to write the coverage, which purchased through Midlands can help customers opt to reduce their deductible to as little as 1%.
Midlands Management president and CEO Charles Caldwell said the coverage offered by them will be written through A-rated carriers and probably will appeal most to those with commercial properties or more expensive homes.
"The minimum premium begins at $250, which can be higher than the cost of annual earthquake coverage itself on many moderately priced homes," Caldwell said.
"A policyholder whose property is valued at $1 million might be responsible for a deductible of $100,000 or more without this coverage. With this coverage, for a modest annual premium that out-of-pocket cost could be reduced to $10,000."