Time to Take a Second Look at Earthquake Insurance?

As we ponder plowing another huge chunk of money to expand our tiny, tiny house, this news won't make me sleep any easier tonight (via Reuters):

The southern end of the San Andreas fault near Los Angeles, which has been still for more than two centuries, is under immense stress and could produce a massive earthquake at any moment, a scientist said on Wednesday.

Yuri Fialko, of the Scripps Institution of Oceanography at La Jolla, California, said that given average annual movement rates in other areas of the fault, there could be enough pent-up energy in the southern end to trigger a cataclysmic jolt of up to 10 meters (32 ft).

"The observed strain rates confirm that the southern section of the San Andreas fault may be approaching the end of the interseismic phase of the earthquake cycle," he wrote in the science journal Nature.

A sudden lateral movement of 7 to 10 meters would be among the largest ever recorded.

Fialko thinks the big event -- easily causing an earthquake of magnitude 8.0 -- will happen within the next ten years. If there's any consolation for us Angelenos, it sounds like Palm Springs and the Inland Empire (sorry, San Bernardinos) will be hit hardest.

But you still wonder how bad of a hit L.A. will take. We managed to spring back relatively quickly from 1994's Northridge quake; by the time I moved here in 1996, it already seemed like ancient history (except for those who were hit hardest, of course). But this would be a much, much bigger seismic event.

It does make me wonder again about earthquake insurance. The premium is ridiculous, as is the deductible. It didn't seem worth it to us -- we instead decided to spend the $4,000 to get our house bolted. But should we reconsider?

And... if the big one hits, will the money be there anyway?