header image

[Sign Up Now] to Receive Our FREE Daily SCVTV-SCVNews Digest by E-Mail

Inside
Weather


 
Calendar
Today in
S.C.V. History
March 28
1934 - Bouquet Canyon Reservoir, replacement for ill-fated St. Francis Dam & reservoir, begins to fill with water [story]
Bouquet Reservoir


Assemblyman Scott Wilk

Assemblyman Scott Wilk

[Scott Wilk] – Assemblyman Wilk, R-Santa Clarita, recently sent a letter to the California Earthquake Authority asking them to address questions he received from constituents regarding implications of the Santa Clarita Valley Sanitation District’s decision to use the deep well injection (DWI) method might have on earthquake insurance.

Below is the response in its entirety:

 

April 6, 2015

Dear Assemblyman Wilk:

Thank you for your letter of March 23, 2015, and for your questions concerning the interaction of human activities that may be associated with ground movement or ground shaking, and the potential response of CEA earthquake insurance policies.

The California Earthquake Authority (“CEA”) writes almost 8o% of the residential earthquake insurance in California, insuring renters and owners of houses, mobilehomes, and condominium units. Operating solely in California, which has approximately 2/3 of the nation’s earthquake risk, our mission is to educate, mitigate, and insure.

We should be clear, however, that in addressing your questions we do not speak for the other earthquake-insurance writers in California, all private companies, and each of which would have its own policy forms and underwriting standards, as well as its own thoughts and views on the matters you raise.

I’ll restate your questions and answer each:

1. Considering the “tectonic processes only” definition regarding coverage of damages, what constitutes “human activity” and how do insurers determine “whole or in any part”?

CEA response:

The CEA evaluates every claim made on any CEA earthquake policy on its own merits, based on the specific facts presented by that individual claim and the coverages purchased. All CEA policy wording is publicly available and may be found on the CEA website.

To date, no CEA policyholder has presented an earthquake claim in which the facts suggested that the ground-shaking that produced damage was caused in whole or in part by any “human activity,” rather than by purely natural tectonic processes. Evaluating a prospective claim would be hypothetical at this point.

The CEA is unable to speculate on the various hypothetical scenarios of “human activities” that could present themselves in the future, any one or more of which could theoretically result in ground-shaking. Those activities would not be limited to the human activity of deep-well injection (“DWI”). They could include, among other things, extracting oil by the process called hydraulic fracturing (“fracking”), drilling or making use of geothermal wells, drilling or blasting tunnels or mine shafts, accidental explosions, or the intentional use of explosives in excavation, industrial applications, war, or even terrorism.

In a case of damage to a CEA-insured home that, the facts suggest, may have resulted in some way from human activity (such as deep-well injection), the CEA will rely on the best available scientific evidence (especially including, we anticipate, experts from the U.S. Geological Survey and the California Geological Survey) to determine whether the damaging ground movement (1) resulted from human activity and would not have occurred without human activity, or (2), was the result of natural tectonic processes and would have occurred even in the absence of human activity.

This structure of risk management is consistent with the concept of a natural disaster (catastrophic risk) policy, such as the CEA’s earthquake policies: • For wholly natural disasters, which result in no way from human activity—for example, a typical earthquake or hurricane—no humans bear responsibility for losses. in those cases, a homeowner whose home is damaged has no legal recourse against a person or entity for the loss—the only feasible protection method is insurance. • But when a loss is caused by human activity, the injured party can seek legal recourse against the person or entity that caused that loss.

2. Is the presence of deep well injection activities in a seismic event’s area currently considered to constitute an exclusion from coverage based on the definition of “Tectonic processes”. If so, at what distance from any seismic event is DWI no longer considered to have initiated “in any part”?

CEA response:

The presence of deep-well injection activities would not affect whether a property can be insured with a CEA policy; a CEA insurance policy can be purchased in an area where deep-well injection is occurring. As a related matter, the presence of deep-well injection activities would not result in exclusion from coverage under a CEA policy of losses that are caused by an “earthquake,” as “earthquake” is defined in the CEA policy. If any human activity (including DWI) triggers damaging ground motion that the scientific evidence suggests would not have occurred in the absence of that human activity, that loss would not be one that resulted from an “earthquake” (as earthquake is defined in the CEA policy) and thus would not be covered under a CEA earthquake insurance policy.

That decision will be made based on the scientific evidence specific to that particular loss, and that loss would not be covered if, and only if, the scientific evidence leads to the conclusion that the ground shaking that caused the loss resulted from human activity rather than from natural tectonic forces.

There is no geographical or distance limit or component to this determination.

3. If the CEA is aware of a deep well injection site near a homeowner who is applying for earthquake insurance, does that fact either defeat issuance of the policy or change the premium charged?

CEA response:

The presence of a deep-well-injection site near a property does not affect the property’s eligibility to or insurability under a CEA earthquake policy. In addition, the presence or absence of DWI sites is not a factor in determining the premium rate for a CEA policy.

Because human-activity-caused ground movement is not an insured peril under a CEA earthquake insurance policy, DWI activities do not affect the risk of loss for the sole peril that is insured against under a CEA policy and hence do not affect eligibility or price.

4. Does the CEA have specific experience that they can cite relative to the questions above with other California communities where DWI is taking place?

CEA response:

No, we are not aware of any claims having been submitted to the CEA, to date, in which human activity (including, but not limited to, DWI) are thought to have caused or to have contributed to damaging ground movement. The CEA cannot cite any other experience that would provide information on DWI occurring in or near any California community.

The California Geological Survey may be able to provide information that is responsive to the non-insurance aspects of your questions. We would be happy to facilitate your contact with CGS.

 

Sincerely,

Glenn A. Pomeroy

Chief Executive Officer

California Earthquake Authority

Comment On This Story
COMMENT POLICY: We welcome comments from individuals and businesses. All comments are moderated. Comments are subject to rejection if they are vulgar, combative, or in poor taste.
REAL NAMES ONLY: All posters must use their real individual or business name. This applies equally to Twitter account holders who use a nickname.

3 Comments

  1. Jeanne says:

    So we would be left with hoping that the company who triggered an earthquake had enough money to cover all homes that might be damaged or destroyed by “ground movement” they caused.

    Also this is an indication of the “pass the buck” we would see as we try to recover and rebuild our homes. Each side saying they are not liable for the damages. Great. We could be left out in the cold with no home for years while this works its way through court.

    • SCVNews.com says:

      They probably don’t know because it has never happened. We’ve been using deep-well injection in the Santa Clarita Valley for more than 50 years (still do today), and it has never triggered an earthquake.

  2. Jeanne says:

    I did not see anything in this story about this type of drilling being done for 50 years in SCV. Why just in the comment section?

Leave a Comment


SCV NewsBreak
LOCAL NEWS HEADLINES
Thursday, Mar 28, 2024
April 16: FYI Seeks Volunteers To Pair With Local Foster Youth
Local nonprofit Fostering Youth Independence is seeking “Allies” to support Santa Clarita youth who are aging out of the L.A. County foster care system.
Thursday, Mar 28, 2024
California Announces $25 Million in Awards for Youth Mental Health
To support the mental health of California's young people, the California Department of Public Health awarded $25 million to 28 tribal and community-based organizations across the state.
Wednesday, Mar 27, 2024
California Launches New Youth Suicide Prevention Campaign
The California Department of Public Health launched the “Never a Bother” campaign, a youth suicide prevention public awareness and outreach campaign for youth, young adults, and their parents, caregivers, and allies.
Keep Up With Our Facebook

Latest Additions to SCVNews.com
Local nonprofit Fostering Youth Independence is seeking “Allies” to support Santa Clarita youth who are aging out of the L.A. County foster care system.
April 16: FYI Seeks Volunteers To Pair With Local Foster Youth
The Los Angeles County Department of Public Health today unveiled the latest L.A. County Health Survey, which gathers vital data on health behaviors, conditions, neighborhood settings, and the needs of L.A .County residents, informing future public health policies and programs.
Public Health Unveils the 2023 L.A. County Health Survey Findings
Due to the projected rain forecast, Eggstravaganza will now be held indoors at the Canyon Country Community Center beginning promptly at 10 a.m. on March 30.
March 30: Eggstravaganza Now Being Held Indoors at Canyon Country Community Center
To support the mental health of California's young people, the California Department of Public Health awarded $25 million to 28 tribal and community-based organizations across the state.
California Announces $25 Million in Awards for Youth Mental Health
The College of the Canyons Athletic Department will host a dedication ceremony to unveil the Michele Jenkins Softball Team Room in honor of the longtime board member and ardent softball program supporter’s nearly 40 years of service to the district.
April 16: COC to Host Michele Jenkins Team Room Dedication Ceremony
PFLAG Santa Clarita has announced the establishment of the Peggy and Jeff Stabile PFLAG SCV Scholarship. The scholarship will provide financial assistance to LGBTQIA+ students pursuing higher education and committed to advocating for LGBTQIA+ rights and promoting diversity and inclusion.
PFLAG SCV Announces Stabile PFLAG Scholarship
1934 - Bouquet Canyon Reservoir, replacement for ill-fated St. Francis Dam & reservoir, begins to fill with water [story]
Bouquet Reservoir
The California Department of Public Health launched the “Never a Bother” campaign, a youth suicide prevention public awareness and outreach campaign for youth, young adults, and their parents, caregivers, and allies.
California Launches New Youth Suicide Prevention Campaign
The Santa Clarita Master Chorale invites the community to "Let the Sunshine In," a delightful evening of food, wine and song at the annual Cabaret & Cabernet fundraising benefit.
April 20: Santa Clarita Master Chorale’s Cabaret, Cabernet Fundraiser
The Los Angeles County Department of Public Health cautions residents who are planning to visit the below Los Angeles County beaches to avoid swimming, surfing, and playing in ocean waters:
March 27 Ocean Water Warning
As an integral ingredient necessary to help the Santa Clarita Valley to flourish, feedback from the business community is the secret sauce for achieving great things.
SCVEDEC Asks For the Business Community’s Opinion on Santa Clarita
Raise your heart rate while raising funds for the Santa Clarita Sister Cities Dollars-for-Desks campaign to provide school desks for students in Sariaya, Santa Clarita's Sister City in the Philippines.
April 13: Sister Cities Zumba-thon Fundraiser
Remo, Inc. is is the world's leading manufacturer and developer of synthetic drumheads and shells. They’ve been in business for 60 years
SCVEDC Company Spotlight: Drumming Up Big Business with Remo, Inc.
California State Assemblywoman Pilar Schiavo (D-Chatsworth) and Assemblyman James Ramos (D-Highland) have introduced AB 3074 the "School or athletic team names: California Racial Mascots Act."
Schiavo Introduces Bill to Prohibit ‘Derogatory’ School Mascot Names
Los Angeles County’s Justice, Care and Opportunities Department  in collaboration with Local Initiatives Support Corporation Los Angeles is proud to announce the 2nd Annual Pitch Competition for the cohorts of JCOD's Incubation Academy.
March 28: JCOD Incubation Academy Helps Grassroots Non-Profits For the Second Year
Children’s Bureau is seeking foster families and now offers two virtual ways for individuals and/or couples to learn how to help children in foster care while reunifying with birth families or how to provide legal permanency by adoption.
April 18: Children’s Bureau Hosts Virtual Orientation
The Sunburst track was constructed in 1887 by the Southern Pacific Railroad and was a part of the main line running between San Francisco and Los Angeles.
Enjoy Spring With a Ride On The Sunburst Track
California State Superintendent of Public Instruction Tony Thurmond hosted a Personal Finance Summit today where he announced his support for Assembly Bill 2927 (McCarty), legislation that would require a personal finance education course for California high school graduation.
State Superintendent Announces Support for Personal Finance Graduation Requirement
1847 - Probable birth date of Pico Canyon oil driller Charles Alexander Mentry [story]
C.A. Mentry
The first Music Jam Session at The MAIN was held on Thursday, Feb. 22 and was a hit. Come out and join in for the next one on Thursday, March 28 7 p.m.-9 p.m.
March 28: The MAIN to Host Musicians’ Jam Session
Los Angeles County Inspector General Max Huntsman of the Office of Inspector General has issued a report entitled "Tenth Report Back on Implementing Body-Worn Cameras in Los Angeles County."
Office of Inspector General Issues Latest Report on LASD Body Cams
College of the Canyons women's tennis played to a convincing 7-2 conference win over Ventura College on Moica to strengthen its potential playoff resume.
Canyons Closes Out Ventura 7-2 in Final Home Match
Join the Santa Clarita Valley Chamber of Commerce with the Latino Business Alliance at the Cinco de Mayo Networking Celebration on Tuesday, May 7.
May 7: Latino Business Alliance Cinco de Mayo Celebration
SCVNews.com