What Does Earthquake Insurance Cover?
What Can Earthquake Insurance Cover?
Earthquake policies commonly separate coverage into several parts so the structure, belongings, and temporary living needs can be evaluated independently.
Dwelling Coverage
Dwelling coverage may help repair or rebuild qualifying earthquake damage to the insured home, subject to the applicable limit, deductible, exclusions, and policy terms.
Personal Property
Coverage may be available for qualifying earthquake damage to furniture, electronics, clothing, appliances, and other belongings, subject to the policy’s personal-property limit.
Additional Living Expense
If a covered earthquake makes the home temporarily uninhabitable, qualifying costs for lodging and other additional living expenses may be available depending on the policy.
Earthquake Deductibles Can Be Very Different From Home Deductibles
Earthquake deductibles are often calculated as a percentage rather than as a simple flat dollar amount. That can create a significantly larger out-of-pocket responsibility after a major loss.
A deductible may be based on a percentage of the applicable insured value rather than a fixed amount such as $1,000 or $2,500.
Review whether the dwelling amount reasonably reflects the cost to repair or rebuild the home after a major earthquake.
Personal-property coverage may be lower than the amount available under the homeowners policy and should be reviewed separately.
Consider how much temporary housing and other qualifying living expenses may cost if repairs take an extended period.
What Should Homeowners Review Beyond the Main Coverage Limits?
Earthquake policies can contain important restrictions for certain structures, property types, and causes of loss. Understanding those provisions can help avoid surprises later.
Foundations, chimneys, masonry veneer, retaining walls, and similar property may be subject to special limits or exclusions depending on the policy.
Garages, sheds, fences, pools, patios, and other structures may not receive the same treatment as the primary dwelling.
Flood, land movement, water damage, fire following earthquake, and other resulting losses may be treated differently depending on the cause and policy language.
Foundation bolting, bracing, water-heater securing, construction type, year built, and other mitigation factors may be relevant to underwriting and loss prevention.
Have You Reviewed What Your Earthquake Policy Actually Covers?
Best Formula Insurance can help homeowners review earthquake dwelling coverage, personal property, additional living expenses, deductibles, limits, exclusions, and other earthquake insurance considerations.