Guide to Earthquake Insurance

Disaster Insurance, Earthquake Insurance, Insurance, Natural Disasters

Earthquake coverage can usually be added to a home or business policy and is not normally purchased as a separate policy. The standard homeowner’s policy has an exclusion for “Earth Movement”, which includes earthquakes, landslides, mudflows, sinkholes, and more.

What is an earthquake?

A sudden and violent shaking of the ground, sometimes causing great destruction, as a result of movements within the earth’s crust or volcanic action.

Homeowners can purchase earthquake insurance to cover both the building and its contents, while renters can often get earthquake coverage for their possessions. Earthquake coverage can include loss from breakage (such as a television set or furniture, but not fine china, crystal or fine artwork). Note that there is a separate deductible for earthquake damage or loss that can vary from 5% to 15% depending on the state or company. States that are prone to earthquakes often have rules particular to the companies that insure properties in those states.

You should always review the Division of Insurance website in your particular state to see if there are conditions that affect you. It is also very important to read your policy endorsement to understand what is covered, what is excluded or what is limited. Since different states have different regulations, it is wise to consult with your local insurance agent.

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