Earthquake risk in the San Francisco Bay Area is growing, according to catastrophe risk modeller RMS.

But while the risk is growing, quake insurance penetration in California has more than halved since the 1989 Loma Prieta earthquake in the Bay Area, which caused nearly $US6 billion ($6.85 billion) in economic losses.

“A worst-case, magnitude-7.9 earthquake on the San Andreas fault could strike an urban centre with 32 times the destructive force of Loma Prieta, potentially causing commercial and residential property losses of more than $US200 billion ($157.5 billion),” RMS says.

The financial impact would be magnified by the fact only 10% of households in the state have quake insurance.

RMS says it would have a “devastating” impact on the Bay Area economy.

Senior Director of Model Product Management Patricia Grossi praises the region’s infrastructure preparedness, but warns: “Without significant earthquake insurance penetration to facilitate rebuilding, the recovery from a major earthquake will be considerably harder.”

The magnitude-6.9 Loma Prieta quake caused 63 deaths, injured 3757 people and destroyed more than 11,000 homes.

The US Geological Survey says there is a 63% chance a magnitude-6.7 or larger quake will hit the Bay Area over the next 30 years.

Since 1989 the region’s population has grown 25%, the value of residential property has risen 50% and commercial activity has significantly expanded.

The Bay Area has a GDP of $US535 billion ($421 billion).