By: Luke Jones, Published on April 13, 2018 12:35 PM, Last Update on April 13, 2018 09:36 AM
Homeowners in Quebec are still not considering earthquake insurance as an add-on to existing home insurance policies. One industry executive says it will take insurance providers an “extended period of time” to convince even 25% of the market to adopt the coverage.
Around 95% of homeowners in the province do not have earthquake protection, Edouard Schmid, group chief underwriting officer for Swiss Re, said at the company’s 33rd annual breakfast meeting in Toronto. Furthermore, only around 4% of homeowners near Quebec City have the insurance.
It is a situation that Don Forgeron, president and CEO of the Insurance Bureau of Canada (IBC) described as a “conundrum” and is at a loss to explain why earthquake coverage is not receiving deep penetration in Quebec. British Columbia, for example, has 60% of homeowners with separate earthquake coverage.
“I just think awareness is at the heart of it. There is no question there is a lack of awareness in Quebec.”
Forgeron says customers simply do not know about the viability of earthquake protection and points out it “is not an inexpensive product.”
He urges the property and casualty market to take action, but it may take a long time to even penetrate a quarter of the market due to the “insurance gap”.