Earthquake Insurance

The earthquake insurance man came today. We haven’t suffered too much damage but one aftershock was strong enough to put a few cracks in our bedroom walls and dislodge a few roof tiles. Seeing as we are paying insurance premiums, I thought it would be worth making a claim. He was a rotund chap, the earthquake fellow, jolly in manner and jowly in face. He smiled broadly as he introduced himself and handed my wife a small towel by way of an introductory gift.

‘So may I see the damage?’ he asked.

We took him upstairs and showed him the three lines which were now decorating our bedroom walls. We pointed out of a window to the broken roof tiles. He hummed and hawed a bit and, ominously, he sucked air through his teeth.

‘Can I see your house plans?’ he asked.

‘Should we have them?’ my wife asked.

The man said we would have had them from when the house was built. We told him that the house was second-hand and he sucked air though his teeth again. My wife sent me off to the suitcase that serves as our important documents file and there, amongst countless pieces of paper whose meanings are entirely lost on me, I found a little sketch of a house.

‘Is this it?’ I asked the man.

‘Well, it will do,’ he said.

He looked at the plans for a moment, read a few words written underneath and then wiped a fleshy palm over a slightly sweating face.

Chotto…’ he said.

My wife and I looked at each other, knowing that the decision not to pay out had been made.

‘If the house were made of wood…’

I was none the wiser. ‘If the house were made of wood…what?’

‘Look, here,’ he showed my wife the small print. Actually, not the small print, just the print really. ‘If your house were made of wood the cracks and the roof would be covered, but this house…’ He let his meaning sink in.

It was there in writing and I knew better than to try and argue with an insurance company just because we didn’t like the terms we had agreed on at the time.

‘Out of interest,’ I asked. ‘What are we covered for?’

The man explained that were the house to be damaged to more than a tenth of its value we could reclaim some of the costs of repair. Similarly if it collapsed completely we would be eligible for a payment of its approximate value. Importantly, however, that does not mean the full cost of rebuilding and as our house is already very old its value is small. The land is still worth a bit, but not the actual house. So I suspect that if another quake damages my house significantly, I will have to fork out a huge amount to rebuild. But at least I will have my own ground to camp on until I raise the necessary funds. Maybe I should invest in a large tent instead of monthly insurance payments.

The man had come and delivered some bad news and we bowed and thanked him profusely. My wife apologized for having inconvenienced him when he must be very busy.

I’m not fond of insurance companies. Who is? But I can’t say I was surprised. They are the same the world over and if I signed the contract without properly caring about the terms then more fool me. I am concerned about the ‘If your house was wooden…’ thing though. What does that mean? To me it signals that our house not being wooden makes it high risk. After all, that is what insurance companies do, isn’t it. They have get-out clauses for anything which makes it more likely that they will have to pay. An adventure-sport tourist may get insurance including cover for injury resulting from scuba-diving, but this is less likely if he confesses he will do said diving in shark-infested waters in a Lady Gaga-inspired wet suit composed entirely of raw chunks of steak. Why? Because he is a fool who is asking for trouble. Few insurance companies would take on a bet like that.

And so back to me. I have bought an old house that shakes when buses pass. I have bought that house in a very earthquake prone area of the most earthquake prone country in the world.  And its not made of wood, which, apparently, adds to my risk. I like living here and will continue to do so, but I now trust the sturdiness of my house as I would trust my erection in a fluffy Hello Kitty condom. It might stay up, but you wouldn’t put money on it.

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5 Responses to Earthquake Insurance

  1. judi(togainunochi) says:

    I gave up on insurance long ago. I have it, but I think if I read the insurance “speak” correctly, I’m covered for damages if I my house is picked up by a tornado, dropped somewhere in Kansas, Dorothy and Toto are there, and the Wicked Witch of the East can’t find the ruby slippers.

  2. Mr. S. says:

    I will never buy a house in Japan, though I wish you the best.

    Where I am, Kanto, we’re long overdue for ‘the big one’. Apparently the Tohoku one does not eliminate the threat. You can’t get meaningful insurance coverage. Half of the land is ‘reclaimed’ and prone to liquefaction, like in Urayasu where people have lost the value of their buildings. Not to mention construction is shite, built to last a few decades at best, insulation is a foreign concept, home foundations are to a standard we use for garden sheds in Canada, the building is worthless to the next person to buy the land, and the seller often has to pay for its removal. Property value has done nothing but collapse since ‘The Bubble’, the country’s had a twenty-year recession, and its demographics make it one of the worst investment opportunities in the world.

    Renting is fine by me.

    • I agree it’s not a great investment, but on the other hand I do pay less for my mortgage than I did in rent and because the house was second hand I actually paid very little for it – the price was all in the land and the land should hold its value. But, I didn’t buy with a view to making money; I bought to have a permanent place for my school. I don’t regret it as it works for me, but definitely not something i would encourage everyone to do. And building new I would probably recommend even less, especially if you think you might move.

      • Mr. S. says:

        You bought the building second-hand, which puts you way ahead of the average Japanese middle-class buyer, and as you point out, it provides a location for your business. Your purchase was intelligent, not that you need my approval!

        Japan’s real estate buyers are just a degree more irrational than N.American, as we see in the American slump, soon to come to my native Canada. I come from Toronto which is still far over valued. I had friends and family telling me to buy in the last five years, when it was already overvalued, that I had to buy NOW or the price would be even HIGHER! To them I am a deadbeat as a renter, never mind how many better long term investments I have made, during my wait to buy in at the bottom, when it comes. It’s not like I haven’t seen several fifteen-year boom/bust cycles already. C’mon!

        And if I had bought a house in some suburban hell we could afford, we’d also have wasted money on two cars, spent all of our time in them, been as fat as our peers doing the same, as over-mortgaged, and been unable to afford to travel to my wife’s native Japan, have her take the first years off of work to be with our child, or come to Japan for the first three years of his life, and during my father-in-law’s battle with cancer. Sigh. Home buying is not rational.

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