Covered For Mudslides? How This Insurance Is Different

NPR's Kelly McEvers talks to a local restaurant manager in Oso, Washington, and Karl Newman, president of the Northwest Insurance Council, about insurance coverage for the victims of the recent mudslides.

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KELLY MCEVERS, HOST:

This is ALL THINGS CONSIDERED from NPR West. I'm Kelly McEvers.

People across the state of Washington observed a moment of silence today to mark one week since a landslide washed over a square mile of land in the town of Oso.

Bonnie Rose manages a restaurant and ranch in Oso. She had to evacuate 150 people from the building. Now, the restaurant has become a kind of community center for survivors. Bonnie, welcome to the show.

BONNIE ROSE: Thank you.

MCEVERS: So you've opened back up now, huh?

ROSE: Oh, yeah, we just wanted to be out here and ready in case that any volunteers need to be fed. We're holding clothing, bedding, household items until people are ready to start over again, because they've lost everything. So they have to start over from scratch.

MCEVERS: It sounds like it's a real haven for people right now, a place for people to go.

ROSE: Yes, because we're a small town, and so our friends and neighbors are coming in just to give us a hug and say, hey, we made it. And also just to give condolences and hugs and a cup of coffee and just somebody to talk to and reminisce and just feel that community strength and spirit from Oso, because those people are like my regulars that came in for fish and chips and for our bingo night. And that's the part for me that I get so emotional about is I know that I won't be able to see those folks again.

MCEVERS: I'm very sorry.

ROSE: Yeah. These people, they're going to need everything. I mean, every last item needs to be replaced.

MCEVERS: You know, now - I mean, not only have people lost their homes, but now they're having to deal with stuff like insurance claims and FEMA and rebuilding. Are people even talking about rebuilding yet? Are they still just sort of dealing with the loss?

ROSE: This is really raw and really fresh. So there is some talk of that. There's a huge disappointment because there's a lot of people that are afraid that they are not going to be covered because of insurance clauses. So they're worried about it, and they're talking about it over the table.

MCEVERS: I was wondering, you know, you live nearby. You live in the area. Are you a homeowner yourself, and do you have landslide insurance?

ROSE: Do not have landslide insurance, no. So that's something where you kind of wake up and think, what kind of a policy do I need? Because who would've thought that there was a landslide and flood can happen in that area?

MCEVERS: Right. Is this something other people are talking about as well?

ROSE: Yeah. Yeah. There's some people that were really surprised to know that they needed that kind of insurance.

MCEVERS: Oh, that you needed even a separate kind of insurance.

ROSE: Right. And the other thing, too, is that there's some people that you can't rebuild up there. There's nothing left. So to start all over, where will they go? And just it's so fresh that everybody's just trying to process still what they're going to do and where they're going to go.

MCEVERS: Bonnie Rose manages the Rhodes River Ranch in Oso. Bonnie, thank you so much.

ROSE: Thank you.

MCEVERS: Bonnie is not an outlier. Very few homeowners in Washington state have mudslide insurance.

Karl Newman is the president of the Northwest Insurance Council, a nonprofit public education group funded by insurance companies.

A standard homeowner's policy is designed to cover the risks that pretty much everybody with a home would have. That would be fire and theft and wind and things of that nature. Now, when it comes to landslide, the only type of policy you can get is the difference in conditions policy, which sounds odd until you think about what it means, which is a difference in conditions for your property versus most of the typical properties out there that may not be above or below a steep slope.

He says people don't want to pay extra for these policies. In Washington, it's almost twice as much as the standard homeowner's policy.

KARL NEWMAN: But you're still talking about less than what it would cost to cover two cars for a year if you have newer vehicles in full coverage. And for most of us, our home is our most valuable asset. So we think it's really a matter of perspective.

MCEVERS: Newman says even if people who lost their homes but didn't have landslide insurance do get some federal assistance, it won't cover everything. Back in Oso, Bonnie Rose says people are banding together to help each other get by. The next step is the rebuilding.

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