Only 45% of Israeli homes insured against earthquake

The state's fund for dealing with damages from an earthquake, which is supposed to supply solutions for immediate economic needs - is empty.

The State of Israel is not prepared to deal with the economic and financial consequences of an earthquake. That is what arises from discussions at a Knesset sub-committee for insurance chaired by MK Fania Kirshenbaum (Yisrael Beitenu). Documents from the subcommittee, which reached "Globes", show a number of signs that clearly show the lack of preparedness.

According to the documents, Ministry of Defense assets are not insured against such an event, and the Ministry itself says that insurance money will come from the base budget (the current state budget).

Other problems that were listed include the fact that 45% of residences in Israel lack earthquake insurance - as do one of four ports.

The state's fund for dealing with damages from an earthquake, a fund which exists and operates in countries like Japan and is supposed to supply solutions for the immediate economic needs - is empty.

Another problem is that the estimated value of Israel's roads and public buildings is not up to date.

Israel Electric Corporation (IEC) (TASE: ELEC.B22) and Mekorot National Water Company both have insurance, but only partial - it does not fully cover the total value of the systems.

Local municipalities are especially problematic, as the municipalities which are insured are the wealthy ones and have lower chances of being hit - while the ones more exposed, like Safed and Beit Shean - are not insured.

The committee wrote in its report, "The picture that emerges is that the financial and insurance-related preparedness of the government for an earthquake is found wanting."

Published by Globes [online], Israel business news - www.globes-online.com - on March 16, 2011

© Copyright of Globes Publisher Itonut (1983) Ltd. 2011

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