I told my agent all I wanted was a policy that allows me to pay off the loan in the case of a catastrophic event.  

I let them know that if anything catastrophic happens to the rental, NONE of their stuff will be replaced under my policy.

Anything else, that's five+ months of negotiating with the neighborhood and planning department.I can't see an outcome other than catastrophe for housing affordability.

When I asked my insurance company about the high rebuild costs they said that the high rebuild estimate was based on the fact that these were older homes in established neighborhoods and if there was a catastrophe and the homes needed to be rebuilt they would be considered "custom" rebuilds which of course means higher premiums.

The implications to the tenants and the owners could be huge in the event of a catastrophe.

This is very time intensive but I can't tell you how many times I have been given bad information that could have been catastrophic if I hadn't verified it. 2.

i.e. don't get insurance, and on the off chance something catastrophic happens take your loss and sell the land for $3k or whatever it is worth.  

I think it depends on your economic outlook and the weight you're willing to put behind your beliefs.Not to open up another argument, but as an example, if Manuel truly believes that an economic collapse is inevitable within the next top 10 year (and for anyone else who believes this), I really don't understand why there is any other option besides cashing in everything you have, transferring your net-worth to another currency and moving to another country.On the other end of the spectrum, for those that believe the status quo (not necessarily today's conditions but the "typical" economic conditions of this country) will continue indefinitely, I see no reason to change any course from where it previous has been, assuming you believe that course was previously correct.Now, I guessing, many are like me in their belief that the economic landscape is changing -- perhaps not catastrophically, but certainly non-trivially.

I am in business to make money, but not off the backs of those suffering a catastrophic health event. 

I find it amazing that only 2.1% change in home ownership was this catastrophic.