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July 2005

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CEA to Hold Public Meetings
“Examining the CEA’s Financial Structure Capacity Beyond 2008”

As it begins to study and analyze its Financial Capacity Beyond 2008, the CEA has invited the public to contribute ideas and participate in two open meetings.

Close consideration of the CEA’s financial resources is being prompted by the statutory sunset on December 1, 2008, of the Authority’s so-called First Industry Assessment Layer (or 1st IAL) of $2.18 billion. At its meeting last month, the CEA Governing Board unanimously approved staff’s proposal to hold public meetings in Northern and Southern California to generate ideas and encourage public participation in the process.

Checked Box

Southern California
The July 25th Southern California public meeting will be held at the Crowne Plaza Hotel, LAX (at Los Angeles International Airport).

Checked Box

Northern California
The Holiday Inn, San Francisco International Airport North
(actually in South San Francisco), will accommodate the August 17th meeting.

 

Meeting Times
Both sessions will begin at 9:30 a.m. and are expected to wrap up by noon.

Participants will be asked to consider this question, fashioned from Goal Two of the CEA Strategic Plan: “How can CEA best meet its goal to maximize the CEA’s ability to pay 100% of covered claims at any given time while maintaining sufficient resources to continue as a viable entity?” The CEA welcomes all perspectives at the meetings, which will feature non-CEA professional facilitators who will lead brainstorming and roundtable discussions.

An invitation with more information and exact meeting addresses is available on the CEA Web site at www.EarthquakeAuthority.com.

For space-planning purposes, please RSVP as soon as possible by emailing the CEA at FinancialMeeting@calquake.com or by calling the CEA toll free at (877) 797-4300—please indicate which meeting(s) you plan to attend.

CEA Governing Board Approves 2006 Financial Structure

The CEA Governing Board last month approved a staff-recommended 2006 financial structure for the Authority that will feature reinsurance and revenue bonds as the preferred financial products. The Board did not take up proposals from the CEA’s Financial Alternatives Working Group , which had conducted a systematic evaluation and comparison of available financial products. The Board’s approval gives CEA staff authorization to negotiate next year’s reinsurance contracts.

On a related topic, the Board authorized CEA staff to explore reinsurance financing alternatives to the present reinsurance program that backs the CEA’s supplemental-coverages program.

CEA Governing Board Approves Additional 'Product Enhancements'

Consumers will have more options and flexibility in CEA earthquake insurance if the CEA succeeds in implementing two new Board-approved CEA insurance-policy enhancements.

After examining more than 40 options for making earthquake insurance more attractive to residential consumers, the CEA’s Product Enhancement Committee narrowed its list to three. Two of those options were presented to the Board last month (it was determined that a third option needed more study): Enhanced personal property coverage and emergency living expenses would be available as independent options, and homeowners policyholders would be able to buy an additional $10,000 in building code upgrade coverage.

The enhancements will be part of a new CEA rate filing, presently slated for Board consideration in August. The last Board-approved product enhancements were rolled out in l999.

CEA Responds to Flurry of Earthquakes

California Earthquake Map

About a dozen claims have been filed to date on CEA policies as a result of earthquakes up and down the state between June 14th and June 26th. The claims tally now stands at one claim from the North Coast, six claims from the event in Yucaipa, and seven from the 5.2 Anza temblor.

CEA’s Earthquake Response Team ensured that the CEA Governing Board and key CEA staff were informed immediately.

CEA staff was ready with immediate information for consumers, participating insurers, and the media as the state shook with seismic activity, prompting a wave of telephone calls. We were ready for the calls because, coincidentally, an Are You Prepared? information campaign of mailings and radio spots had just been launched in May. The campaign had prompted a higher than usual call volume about earthquake insurance, but actual earthquakes always accelerate consumer interest in earthquake insurance.

During June, CEA received 1,500 telephone inquiries from consumers, insurance agents, and the media—the normal telephone traffic from those sources is about 200 calls a month.

The CEA Web site, www.EarthquakeAuthority.com, also experienced increased activity: The number of visitors (unique hits) to the CEA’s on-line estimated-premium calculator increased 200 percent over previous months. And for the same timeframe, visits to the Are You Prepared? Web page increased by 57 percent over the previous month.

The media also looked to CEA for earthquake information: Inquiries came in from dozens of media outlets, including National Public Radio, Associated Press, the Los Angeles Daily News, the Sacramento Bee, the Inland Valley Daily Bulletin, and the Orange County Register , as the CEA provided information about earthquake insurance and preparedness. The CEA was also featured in the June 21st Orange County Register column, Ask the Expert, and on Santa Rosa’s KSRO talk-radio program, Your Money with Ken Beck.

Earthquakes Emphasize Importance of Preparedness

Even as the June temblors rolled through California, the CEA was at work on a number of campaigns to help Californians protect themselves from seismic harm. The CEA recently contracted with Baja Pacific, a private earthquake-preparedness firm in San Diego, for a series of Southern California workshops—the workshops will gather participants for a hands-on demonstration on securing household items.

’06 San Francisco Earthquake Centennial Promotes Preparedness

1906 Earthquake Graphic

CEA representatives met last month with the ’06 Alliance, a network of public, private, and nonprofit organizations working to enhance consumer education during the Centennial of The Great 1906 San Francisco Earthquake. The group has charted an ambitious goal of getting 25 percent of the San Francisco Bay Area population—some 2 million people—to take action to prepare for earthquakes.

For more information about next year’s centennial events, visit the ‘06 Alliance Web site at http://www.sjsu.edu/cdm/1906eqconf/index.html

 

2005 CEA Board & Advisory Panel Meeting Schedules Details

CEA Governing Board
Unless otherwise noted, all CEA Governing Board meetings are on Thursdays and begin at 1:00 p.m.

  •  August 25
  •  November 17
  •  December 15

CEA Advisory Panel
Unless otherwise noted, all CEA Advisory Panel meetings
are on Thursdays and begin at 10:30 a.m.

  •  July 21
  •  September 22
  •  October 27

 

 

 

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