Is Your Home Protected? Earthquake Insurance in Seismically Active Areas
What are the two most important things to know about earthquake insurance?
- Most home insurance policies do not cover earthquake damage.
- Even if you don’t live in an area where earthquakes are common, you may still need earthquake insurance.
With earthquakes having occurred in 39 states since 1900, and about 90% of Americans living in seismically active regions, earthquake insurance is essential. For many Californians, this coverage is more affordable than you might think, providing peace of mind against potential damage.
Most homeowners, condo, and rental insurance policies don’t cover earthquake damage, but earthquake insurance can be added through an endorsement or purchased as a separate policy. You can get earthquake insurance from your current provider, a specialized insurer, or through organizations like the California Earthquake Authority (CEA).
While earthquake risks are most significant in certain areas, virtually the entire U.S. would benefit from earthquake coverage. Consider these facts:
- In the West: The U.S. Geological Survey reports a 70% chance of an earthquake of magnitude 6.7 or higher in the San Francisco Bay Area over the next 30 years.
- In the East: The Earthquake Education Center estimates a 40-60% chance of a major earthquake occurring in the eastern U.S. within the next 20 years.
- In the Midwest: The Insurance Information Institute warns of a 40-63% chance of a magnitude 6.0 earthquake along the New Madrid Fault in the next 15 years.
What Does Earthquake Insurance Cover?
Earthquake insurance provides coverage for damages to your home caused by an earthquake. Standard homeowners and renters insurance policies do not cover earthquake-related damage, which means you’ll need to purchase earthquake insurance as a separate endorsement to add to your policy.
While an earthquake endorsement typically does not cover damages from floods or tidal waves (even if caused by an earthquake), it may provide coverage for landslides, mudflows, or the shifting of the earth, provided the damage is a result of an earthquake.
What to Consider When Purchasing Earthquake Insurance:
Home and Other Structures: Does the policy cover only your home, or does it include additional structures like garages and sheds?
Personal Property and Living Expenses: Will the policy cover your home’s contents and additional living expenses if your home is damaged or destroyed?
Exclusions and Limitations: Are there any specific exclusions or limitations to coverage you should be aware of?
Deductible: What deductible will you need to pay before your earthquake insurance kicks in?
Protect Yourself
Earthquakes can strike at any time, so taking preventive steps is key to protecting your home and family:
- Secure Fixtures: Fasten water heaters, gas appliances, and furniture to walls.
- Create an Emergency Plan: Designate a meeting place outside your home and choose a distant relative or friend as a point of contact.
- Stock Essentials: Keep flashlights, batteries, and candles on hand, and have a portable radio ready.
- Know Utility Shut-offs: Ensure everyone in the house knows how to turn off electricity, water, and gas.
