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How’s your Godzilla insurance?

By Jay MacDonald · Bankrate.com
Friday, May 30, 2014
Posted: 6 am ET

Today, we break from routine. No updates on Obamacare or flood insurance or indemnity for self-driving cars.

Today, we tackle a heretofore unaddressed insurance risk: the devastating impact of a Godzilla attack.

Godzilla destroying a building

Is San Fran covered for Godzilla?

Inspired by the earthshaking (not to mention eardrum-shattering) approach of the summer blockbuster movie season, the alert forces at PropertyCasualty360 enlisted insurance educators Chris Amrhein and Bill Wilson to assess the coverage we'd need to withstand an assault by a 335-foot prehistoric lizard.

The underwriting challenge begins, as ever, with data. In Godzilla's case, the lizard laid waste to Tokyo in the 1954 original, made his way across the Pacific and through the Panama Canal to remodel New York City in the 1998 remake and (spoiler alert) makes a hearty arugula-and-Golden-Gate-Bridge tossed salad of San Francisco in this summer's return.

Turns out, the iconic bridge had been insured for up to $45 million until 2005, when local officials decided to essentially self-insure by setting aside reserves rather than pony up $1.3 million a year in premiums. While those reserves currently amount to between $12 million and $14 million, the cost to replace the Golden Gate Bridge is estimated at $1.55 billion.

What about your home?

How would a typical home insurance policy stack up if, say, your Victorian row house got stomped and smashed by the big guy? The good news, says Amrhein, is that fire and explosion would likely be covered, as would collapse -- "since it would be due to the weight of ... animals."

The bad news: Earth movement "caused by or resulting from human or animal force" would typically be excluded, as would power failure, one of Godzilla's signature moves.

"So when he rips down all those power lines, there will be hell to pay," Amrhein adds.

Turning to the indelicate matter of "release of waste products," should a Godzilla dropping render a Sausalito, California, ranch home uninhabitable, the damage would likely fall under the "specific cause of loss" category. It covers falling objects.

And if your car gets squashed?

What about your ride? After all, this lizard likes to stomp a Lexus or two. Amrhein says your comprehensive auto insurance coverage would kick in for a Godzilla flattening, classified under "contact with bird or animal." Ditto should Godzilla's fiery breath blister your paint job.

But the experts were stymied by whether a Godzilla attack would trigger coverage under the Terrorism Risk Insurance Act, or TRIA.

"It would depend upon Godzilla's motivation: Was he put up to this by terrorists ... or is he simply a drunken sailor let loose on the town?" Amrhein wonders. "Was he fine until that fuel truck he mistook for a living fellow monstrous love interest blew sky-high, which his tiny brain interpreted as a rejection of his amorous advances?"

Wilson sees it as more of a species issue.

"There is case law that says a nonhuman animal is incapable of forming intent, so exclusions such as vandalism and theft don't apply to animals," he says.

Enjoy the movie!

Here's a look at eight weird insurance policies.

Follow me on Twitter: @omnisaurus.

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