Will homeowners insurance pay if your house falls off a cliff?
Not unless you have what’s called an added DIC — or Difference in Conditions — policy, as it turns out.
That could be an issue for residents of the 12 Peartree Lane homes, in Rolling Hills Estates, that were destroyed by a massive and rapidly moving landslide on Saturday afternoon, July 8.
Warnings allowed folks to evacuate quickly — and safely. But for the homes and the contents of the structures that have fallen into the canyon below — three so far — left homeowners grappling with what’s next. And even those whose homes remain have concerns about the future.
A landslide is considered an “earth movement” event and, like an earthquake, is excluded from standard homeowners and business insurance policies.
Homeowners insurance policies include an “excisions clause” that exclude earthquakes, volcanic eruptions, mine subsidences, mudslides, mud flow, earth sinking, and geological rising or shifting — and landslides.
“Earth movement is not covered,” said Janet Ruiz, director of strategic communications for the Insurance information Institute.
That institute is an industry association that aims to increase public understanding of how insurance works.
Just as separate earthquake insurance is available, a DIC policy — which can also cover earthquakes — will provide additional protection for those who live in areas like the Palos Verdes Peninsula, where land movement often comes as a trade off for the beautiful, cliff-top views.
The additional policies for landslide coverage, she said, are expensive — from several hundred to a few thousand dollars — but many homeowners in those areas have the financial wherewithal to take out the extra protection.
“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.
And anyone buying homes in those areas should…
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