Will Insurance Pay for Homes Destroyed in a Landslide?

Owners of a dozen homes that teetered into a canyon in Rolling Hills Estates may have suffered a total loss, without adequate insurance coverage. They also lost the land beneath their homes.

Homeowners insurance for the 12 destroyed homes on Peartree Lane over the weekend may not be sufficient to cover the damage, the Los Angeles Daily News reported.

Unless property owners added a DIC — or Difference in Conditions — policy, they may be out of luck.

A landslide is deemed an “earth movement” event. Like an earthquake, it’s excluded from standard homeowners and business insurance policies. Such policies include an “excisions clause” that excludes such events as earthquakes, mudslides … and landslides.

“Earth movement is not covered,” Janet Ruiz, a spokeswoman for the Insurance Information Institute, told the Daily News.

Just as separate earthquake insurance is available, a DIC policy — which can also cover earthquakes — will provide added protection for homeowners in unstable areas like the Palos Verdes Peninsula

Extra policies for landslide coverage are expensive — from several hundred to a few thousand dollars, Ruiz said. While many homeowners can afford the extra protection, anyone buying homes in those areas should also pay for geological surveys.

“We see a lot of folks like celebrities or business owners who want to live with an amazing view and they’ll take on that risk,” she said, along with the added insurance.

It’s risky, said Cary Bichlmeier, president of Bichlmeier Insurance in Redondo Beach, who moved to the Peninsula two years ago. “And you have to do your due diligence if you’re near a cliff,” Bichlmeier added.

A landslide, though, is also different from many other disasters, said Rolling Estates Councilman Frank Zerunyan, who lives above a different canyon. That’s because you don’t just lose the home — but the land.

”It’s one thing to lose your home to a fire, but this is entirely different,” Zerunyan said. “Not only is your home gone, you can’t rebuild. The land is gone as well.”

— Dana Bartholomew