Understanding Earthquake Insurance for Homeowners

Earthquakes are similar to hurricanes and floods in that they don't occur in every area of the country. This is why most homeowners' policies don't cover the damage they cause. Homeowners who live in areas affected by these natural disasters can add the respective types of coverage to their policies for additional protection. Without these additional policies, a homeowner will be responsible for any damages they cause out of their pocket.

Earthquake Risk in The Pacific Northwest

Although earthquakes are often too small to notice in terms of seismic activity, they do occur. In the rare instances that they are severe, extensive damage can occur to your property, making your home unstable and possibly uninhabitable. There have been over 6,000 earthquakes in the area since the mid-1800s. Without a good earthquake policy, your home may be at risk for potential damage. Even minor damage can be costly.

Earthquake Coverage

Earthquake coverage covers property damage that is the direct result of an earthquake. This includes any trembling or shaking of the earth within 72 hours of a single event. Earthquakes can be caused by tectonic movements, volcanic activity, or similar circumstances that cause the Earth to move or shift in various ways.

Tsunami Coverage

A tsunami is a water-related event not covered by an earthquake or homeowners' insurance policies. A tsunami may, however, be covered by a flood insurance policy. Earthquake insurance will also not cover landslides or erosion. An earthquake may cause many types of natural disasters, but earthquake insurance only covers the damage caused by the earthquake itself. If you are concerned about tsunamis, you must buy coverage for that event.

Additional Living Expenses

If an earthquake damages your home, you may need to find another place to live until the necessary repairs can be made. Additional living expenses are included in earthquake insurance policies to ensure you and your family have a safe place to stay while your home is being repaired. You may need living expenses for one or two months or a year if your home needs to be rebuilt.

Earthquake Insurance Costs

The cost of an earthquake policy for your home or business will depend on the structure type, age, soil composition, and how close it is to significant fault lines. Sometimes, an older home must be brought up to code or retrofitted to qualify for earthquake insurance coverage. Wood-framed homes can flex or shift where a brick home may not. This is part of the reason wood-framed homes cost less to insure.