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Protect Your Home with Earthquake Insurance

If you are shopping for or updating your homeowners insurance, you need to be aware that, while standard policies will cover natural disasters such as fire, hail, and lightning in addition to burglary and theft, most companies require the purchase of a separate policy to cover any damage your home may sustain in an earthquake.

The necessity of earthquake insurance

It is estimated that nearly ninety percent of Americans live in an area that is susceptible to seismic activity. Because predicting the likelihood and magnitude of earthquakes is difficult to predict, purchasing this additional insurance is a gamble.

Earthquakes, of course, are more common in certain regions of the U.S. As a homeowner, it is your right to receive information regarding the seismic activity in the area in which your home is located. Home loan lenders may require those who reside in high-risk areas to purchase an earthquake insurance policy, while individuals who live in lower-risk areas will need to weigh the costs and conditions of a policy against the benefits of having one.

An earthquake insurance policy

Usually, an earthquake insurance policy will carry a high, 10 to 15 percent deductible, which means if your home is worth (and covered for) say $150,000, your deductible will be a minimum of $15,000.

In addition, a standard policy will only cover damages to your primary structure. Additional structures – pools, gazebos, sheds, detached garages – will not be covered if they would also sustain damages during an earthquake.

Options

You may find insurance companies that will provide other extended options for earthquake insurance coverage, so it’s important to be aware of what these might be and the cost involved for each. Compare companies and policies to be sure you find the coverage that will best suit your needs.