Earthquake Insurance

Key Takeaways

Earthquake insurance is a separate policy that covers damage from earthquakes, which is NOT included in standard homeowners insurance. It's particularly important for homeowners in seismically active areas like California, Alaska, and Hawaii. Earthquake deductibles are typically 10-20% of your dwelling coverage, making it a significant out-of-pocket expense before coverage kicks in.

What is Earthquake Insurance?

Earthquake insurance is a separate policy that covers damage from earthquakes, which is not included in standard homeowners insurance. It's particularly important for homeowners in seismically active areas like California, Alaska, and Hawaii.

Use our Home Insurance Calculator to assess your overall home insurance needs.

Why Earthquake Insurance is Important

Earthquakes can cause catastrophic damage to homes, including structural damage, foundation issues, and damage to personal property. The cost of rebuilding after a major earthquake can be astronomical, making earthquake insurance essential for at-risk areas.

According to the USGS, there are approximately 20,000 earthquakes each year in the United States, though most are too small to feel.

What Earthquake Insurance Covers

What Earthquake Insurance Doesn't Cover

• Flood damage: Requires separate flood insurance
• Land movement: Damage from landslides or mudslides
• Fire damage: May be covered by standard homeowners insurance
• Wear and tear: Normal aging is not covered

Earthquake Deductibles

Understanding the Cost Structure

Earthquake insurance typically has a higher deductible than standard homeowners insurance, usually 10-20% of your dwelling coverage limit. For example, if you have $300,000 in dwelling coverage with a 15% deductible, you'd pay $45,000 before insurance kicks in.

Seismic Risk Zones

Understanding Your Risk Level

Earthquake risk varies by location. The USGS maps seismic hazard levels based on the likelihood of ground shaking:

• High risk: Areas with frequent seismic activity (California, Alaska, Hawaii)
• Moderate risk: Areas with occasional seismic activity
• Low risk: Areas with minimal seismic activity

FAQ

Q: Is earthquake insurance required by law?

A: No, earthquake insurance is not required by law, but many lenders in high-risk areas may require it as part of your mortgage.

Q: How much does earthquake insurance cost?

A: The cost varies based on your location, home value, and deductible. In high-risk areas like California, it can cost $800-$2,500 per year.

Q: Does earthquake insurance cover aftershocks?

A: Yes, most policies cover aftershocks that occur within a certain time period (usually 72 hours) after the main earthquake.

Q: Can I get earthquake insurance if my home is not in a high-risk area?

A: Yes, earthquake insurance is available in most areas, but rates are lower in low-risk zones.

References

• United States Geological Survey (USGS)
• Insurance Information Institute (III)
• National Association of Insurance Commissioners (NAIC)

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