NU Online News Service, March 14, 1:31 p.m.EST

While the industry tries to get a handle on losses coming from Japan in the wake of therecent earthquake, insurers in California can expect to seebusiness interruption and other claims from damage caused tomarinas by tsunami waves that hit the coast.

Pete Moraga, a spokesman for the Insurance Information Networkof California (IINC), said information on the extent of the damageto boats and marinas in both Northern and Southern California isunclear, as adjusters have not yet had time to make evaluations. Hesaid he has heard different damage estimates, as high as $50million, but those estimates are unconfirmed.

From the available videos that showed waves sweeping away boatsand damaging marinas, Mr. Moraga said the damage doesn’t seem likeit would cause major losses for insurers, “but it’s tough to tellbefore damage estimates come in.”

Even if early estimates are made, Mr. Moraga said the reliablenumbers will not come out until adjusters conduct theirevaluations. He noted that most early estimates that come out afterwildfires in California are inaccurate. “There’s so much you don’tsee” until the adjusters get in there, he said.

More News & Analysis on the Japanese Earthquake andTsunami

As for the types of coverages likely to be triggered, Mr. Moragamentioned boat insurance, for those owners who took out coverage ontheir vessels. Videos showed capsized boats, but Mr. Moraga saidboats that initially appeared to escape the worst of the eventcould also be damaged after being knocked around against thedocks.

Other losses will come from business interruption claims, Mr.Moraga said. Claimants must meet a physical damage threshold and atime threshold of 48 hours, Mr. Moraga said. He noted that boththresholds will likely be met for businesses in both Northern andSouthern California.

Liability claims could also be filed, he said, stemming fromlawsuits from boat owners who did not have insurance and claim thatthe marina did not properly care for their vessels.

Mr. Moraga said adjusters should be able to get to sitesstarting today, and the scope of losses in California will takeshape thereafter.

As a result of the damage sustained in the state, Governor JerryBrown declared a state of emergency in Del Norte, Humboldt, SanMateo and Santa Cruz counties.

RelatedSlideshows:

• Initial Tsunami Devastation In Japan
• Aftermath of Destruction

Meanwhile, the California Earthquake Authority (CEA) released astatement pointing out the importance of earthquake insurance inthe wake of the 9.0 magnitude quake in Japan. “In California, wehave two-thirds of our nation’s earthquake risk and most of us livewithin 30 miles of a major fault,” said Glenn Pomeroy, chiefexecutive officer of CEA. “But just 12 percent of our homes withfire insruance also have earthquake coverage.”

He added, “The bottom line is that it’s very hard to imagine howa community would recover from a massive quake when nearly all ofthe damaged homes are completely uninsured for the loss.”

He pointed to Christchurch, New Zealand as an area whereadequate coverage will lead to recovery. “In New Zealand, almosteveryone has earthquake insurance on their home,” Mr. Pomeroy said.“Because of this, Christchurch will recover despite thousands of houses being destroyed in recentmonths.”