EARTHQUAKE Insurance Policy
Most homeowners never think about earthquake insurance. This is either because they feel it is unnecessary in the part of the country where they live or because they assume it is too expensive. Earthquakes are not restricted to California, nor are all structures equally protected against damage from a medium-sized tremor. If you are contemplating this type of coverage, remember that your home – and your personal belongings – can be severely damaged in a quake, and your normal homeowner’s insurance policy won’t cover your losses.
Is It Worth The Expense?
Some structures are more at risk than others. Brick homes, for example, are much more likely to suffer extensive damage than a home built with a wood exterior. The dissipation of energy through solid rock is also much different than through loose soil. Liquefaction is the primary cause of building collapse.
Insurance actuaries know these statistics and will price earthquake insurance accordingly. The insurance provider looks at historical data and uses the past events as a probability calculator. The more frequently a quake occurs in a given area, the higher the cost of insurance.
What Is Covered By This Insurance?
Insurance for homeowners generally covers loss of property and belongings caused by fire, high winds, and flooding. Coverage for damages caused by an earthquake includes repairing of the walls, ceiling, and roof of the structure itself. It also covers loss of personal property items such as appliances, furniture, and expensive entertainment systems. However, damage from floods or seismic sea waves caused by an earthquake might not be covered by the policy, so it is extremely important to read over the details carefully.
A 10 percent deductible is standard in the insurance industry for earthquake insurance. If a home is valued at $250,000, the homeowner is on the hook for the first $25,000. It is also important to remember that a severe earthquake – one measuring at least 8.0 on the Richter scale – might cause so much damage to the entire region that rebuilding is out of the question. We help you make sure that the policy covers at least part of the cost to build or buy property elsewhere.