Originally posted by @Alvin Uy:
Those of you who invest in California or Pacific Coast that own property, what are your thoughts on Earthquake insurance? Do you have them for your properties? Is it worth it? If not, what will you do in an event of a major earthquake??
" ...[friend] He thinks if the big one were to hit, this company will more than likely go bankrupt and will never payout the claims."
Tell your friend there's a serious flaw in his logic.
Hell, if he wants to use logic like that, why bother buying any insurance at all? Suppose the entire state of California burns down in a massive wildfire that puts the "Wooley" and "Camp" fires to shame? Suppose all the Central American gangs invade Southern California all at once and rob each and every household over the course of a couple of weeks, shooting and killing and maiming as they go?
Yah, under such circumstances, a lot of insurance companies would likely go belly-up rather than even attempt to pay out claims. So why bother having any insurance at all?
BUT -- suppose there's a disaster of a somewhat smaller magnitude? Just your property catches fire, and only in the front bedroom. Only your TV is stolen and a few pieces of jewelry. And an earthquake far smaller than "The Big One" hits, but it's big enough to cause damage? Say, chimney collapses and crushes your automobile.
You'd kinda want to have insurance under those situations, I'd expect, and their probability is much greater I think.