SACRAMENTO -- In California, two earthquake insurance companies are lowering their rates.
Insurance Commissioner Dave Jones announced Friday that he approved a 15.5% rate reduction for Chubb Insurance. The average annual premium will fall to $5,021 from $5,940, according to the state Department of Insurance.
Chartis Insurance earthquake coverage rates are going down 15%, with average annual premiums dropping to $6,061 from $7,292, the Department of Insurance said.
Overall savings to consumers will total about $15 million, it said.
The rate reduction followed an update to models used to estimate probable earthquake damage.
Jones said he hoped the lower rates would persuade more Californians to buy earthquake insurance. Currently, the Insurance Department said, only 12% of the state's homeowners have the coverage.
"We live in earthquake country and the danger is real," Jones said in a statement. "Anything we can do to make coverage more affordable for consumers is a good thing."
Earlier this year, the state-administered California Earthquake Authority, which dominates the market, cut its rates 12.5%.
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