Joint Powers
Authority for
Landslide Coverage
September 1, 2026
• Receive and file this report re: the possibility of developing a joint powers authority (JPA) to provide individuals with insurance coverage for landslide-related property damages.
• Consider directing staff to submit a letter to State Legislators and the California Insurance Commissioner, requesting the State to consider a program such as the CA Earthquake Authority or FAIR Plan as a mechanism to provide landslide insurance to individuals.
Overview
• In 2023, then-former Councilmember Cruikshank and now-Mayor Seo requested information about forming a JPA that can provide individuals with basic landslide insurance.
• In general, homeowners insurance does not cover damages caused by nonearthquake induced land movement, creating a coverage gap. • In a September 2024 survey of landslide-area residents, none of the 62 residents who answered a question about their homeowners insurance indicated that their policies covered landslide damage.
Background
• Legally created entities with 2 or more public agencies that jointly exercise powers they have in common. JPAs cannot exercise powers that they do not currently have. (CA Gov’t Code 6500-6536)
• Benefit: allows agencies to combine resources, coordinate services, and achieve economies of scale with greater financial and operational benefits to the communities they serve.
JPA Overview
• CA Joint Powers Insurance Authority (CJPIA) has over 125 member agencies that pool and manage risk through self-insurance and risksharing. • Risks include: liability, workers comp, property damage, and other losses that each agency would otherwise manage on its own.
• Note: JPA self-insurance risk pools are authorized by State law and are not considered traditional insurance
Public Agency Insurance Claims
• In addition - RPV (and most other cities) do not possess the authority to issue traditional insurance. As such, it cannot form a JPA with other agencies to issue landslide policies to individuals.
• Two other existing mechanisms could possibly serve as alternate model for landslide insurance. None are JPAs.
Resident Insurance Claims
• Formed after the 1994 Northridge
earthquake that caused ~$20 billion in
residential damage; only half was insured.
• State Legislature created CEA to provide
earthquake insurance, which is optional to
purchase.
• A nonprofit public entity of the State that is
publicly managed and privately funded by
policy holder premiums and other resources
Model 1 - CEA
• All homeowner insurers in CA are required to offer you earthquake insurance every other year – through themselves, 3rd party, or CEA. • Most opt to offer CEA insurance, which represents nearly 2/3 of all residential earthquake policies in CA.
• Insurers who participate in CEA must service the policies, claims adjustments, billing, etc.; and CEA writes the policies and generally bears most of the risk.
Model 1: CEA
• Typically covers damage from earthquake-induced landslides, with limitations. However, they exclude landslides caused by ground/rainwater and other conditions, including the Greater Portuguese Bend Landslide. • In addition, CEA’s current authority is limited to offering earthquake insurance only.
• Expanding that authority to include landslide insurance would likely require State legislation.
Model 1: CEA
• Established by State legislation in 1968 due
to difficulties obtaining insurance for
homes in high-risk areas
• CA’s insurer of last resort, providing basic
property coverage to those unable to
obtain it through the traditional market
Model 2: FAIR Plan
• All insurers doing business in CA are required to participate in FAIR:
o A private association of insurers who manage and share in the Plan’s underwriting, expenses, profits & losses (based on their market share) o FAIR issues policies on behalf of these insurers.
Model 2: FAIR Plan
• FAIR does not insure landslides, in general, unless they are caused by a covered peril like wildfire.
• However, the CA Insurance Code authorizes FAIR to include “other insurance coverages” with the approval of the Insurance Commissioner. • To determine if FAIR could be amended to include non-seismic landslide coverage, further evaluation with the CA Dept of Insurance and legal counsel is the likely next step.
Model 2: FAIR Plan
• Mandating insurers to insure a small subset of landslide residents thru FAIR could place financial pressures on the entire insurance market. • Questions that need to be answered:
• Could landslide insurance encourage individuals to live on active landslides?
• Could insurers exclude damage caused by pre-existing or known landslides, such as Portuguese Bend?
• Additional research and discussions are needed to vet these considerations.
Considerations / Caveats
Recommendations
• Receive and file this report on the feasibility of
developing a joint powers insurance authority for
landslide-related claims by individuals
• Direct staff to submit a letter to State Legislators and Insurance Commissioner to explore creating a
program similar to the CA Earthquake Authority or
FAIR Plan to provide basic landslide insurance to
individuals.
FAIR PLAN CEA
Type Basic property insurance of last resort Earthquake insurance Eligible
Customers
Individuals unable to obtain traditional
insurance due to living in high-risk areas
Available to anyone who wishes to buy one
Organization
Structure
A private insurance association created by
the State and under State oversight
State-created public authority, privately funded
by premiums
Participation All insurers in CA must participate and share in the Plan’s insurance writing, expenses,
profits, and losses.
All insurers in CA may participate in CEA or offer
their own insurance or from a 3rd party.
Risk Participating insurers are part of the
insurance pool and bear all risk
CEA mostly bears the risk, except in extenuating
circumstances
Next Steps Expanding FAIR to include landslide
coverage needs further evaluation by the
Dept. of Insurance and legal counsel
Expanding CEA to include landslides may
require State legislation.