Experts Recommend Insurance With Earthquakes, Floods Part of Life in Arkansas

by Mark Friedman  on Monday, Mar. 18, 2013 12:00 am  

Michael Alexander of Argenia LLC of Little Rock said he sells more earthquake insurance after a big quake has been reported. (Photo by Michael Pirnique)

Alexander, of the insurance company Argenia, said homeowners’ insurance policies don’t cover damage done by earthquakes, which is why a supplemental earthquake policy is needed.

“I personally am not willing to take that gamble,” Alexander said. “So I carry it as well.”

When an earthquake occurs that’s big enough to make the evening news, Alexander sees an uptick in people wanting to buy coverage.

The cost of the insurance depends on the value of the house and how much coverage is needed. He suggested buying the same coverage as the regular homeowner’s policy.

Earthquake coverage for a home generally costs between $50 and $300 annually. The trouble is that when the policy is set to renew, people start questioning if they really need the policy because they haven’t filed a claim.

“It’s worth the gamble,” Alexander said.

Rising Tide

The city of Hot Springs has an emergency warning system that will alert residents when a flood is on its way, said Denny McPhate, public works director for the city. But that’s not enough to prevent flood damage.

“We’ve had a history of major flooding,” he said. The last major flood was in 1990 when cars floated down Central Avenue and business owners had to deal with four and five feet of water.

McPhate said it’s only a matter of time before the next flood comes to Hot Springs.

A retention system would need to be built to protect the city from the overflow of water. That project, though, would most likely cost between $10 million and $20 million. He said the funding would have to come from the federal government.

“We have no funding,” McPhate said.

 

 

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