If you live in an area prone to earthquakes, it’s essential to consider whether or not earthquake insurance is right for you.
Earthquake insurance policies can be very expensive, so many homeowners choose not to get extra coverage for earthquake damage. However, when earthquakes happen, the damage left behind can be very extensive, leaving homeowners in a difficult situation.
While the cost of an earthquake insurance policy may give some homeowners sticker shock, it pales compared to the cost of repairing or rebuilding your home after an earthquake. Earthquake insurance can give you peace of mind in knowing that your home is protected against this type of natural disaster.
In this post, you’ll learn:
● What is earthquake insurance?
● What is covered under earthquake insurance?
● What does earthquake insurance not cover?
● Does renters insurance cover earthquakes?
● How much is earthquake insurance and is it worth it?
● Pros & cons of earthquake insurance
WHAT IS EARTHQUAKE INSURANCE?
Earthquake insurance is a type of insurance that provides coverage for your home if an earthquake causes damage to it. Typically an add-on to your homeowner’s insurance policy, earthquake insurance can also help to cover the cost of temporary housing if your home is uninhabitable after an earthquake.
While earthquake insurance doesn’t cover the cost of all damages that may occur, it can help reduce the financial burden if your home gets damaged during an earthquake.
WHAT IS COVERED UNDER EARTHQUAKE INSURANCE?
Earthquake insurance typically includes three types of coverage: dwelling coverage, personal property coverage, and loss-of-use coverage.
1. Dwelling coverage helps you pay for the damages done to your home structure.
2. Personal property coverage helps you pay to replace items that were damaged inside your homes, such as furniture and electronics.
3. Loss-of-use coverage helps pay for living expenses if you have to live in a hotel or somewhere else during your home renovations.
Earthquake insurance policies vary in terms of the amount of coverage they provide, so it’s important to speak with your insurance agent to determine the best policy for your needs.
WHAT DOES EARTHQUAKE INSURANCE NOT COVER?
Most earthquake insurance policies will not cover any damage that occurs because of a pre-existing condition. For example, if your home’s already sustained cracks in the foundation prior to an earthquake, any further damage that occurs during the earthquake won’t get covered.
Similarly, if an earthquake damages a structure on your property — such as a shed or fence — that was not up to code at the time of the quake, you’ll probably be responsible for repairs.
Most policies will not cover any losses that occur because of the earthquake itself, such as fire or flooding. Finally, most policies have a waiting period of anywhere from 10 to 30 days, meaning that any damage that occurs within this timeframe will not get covered.
As a result, it’s important to be aware of what your policy covers in order to avoid any unpleasant surprises following an earthquake.
DOES RENTERS INSURANCE COVER EARTHQUAKES?
Homeowners and renters insurance policies protect against various risks, but earthquakes rarely get covered. This is because insurance companies consider earthquakes to be “Acts of God “and are thus outside most insurance policies’ scope.
If you live in an area that’s susceptible to earthquakes, it’s important to purchase a separate earthquake insurance policy. These policies can help cover the cost of repairs or replacements if there’s damage to your home in an earthquake. However, they can also be quite expensive, so weighing the costs and benefits before deciding is essential.
HOW MUCH IS EARTHQUAKE INSURANCE AND IS IT WORTH IT?
Whether you should get earthquake insurance is a personal decision. Some people feel it’s worth the peace of mind, while others would rather save the money and use it to pay for repairs if an earthquake ever damages their home.
There are a few things to consider when making your decision.
How much does earthquake insurance cost?
According to Rocket Mortgage, “annual premiums can range from $800 to $5,000, and policy deductibles can be as high as 10-20% of your coverage limit”. That means if you have a $100,000 policy, your deductible could be as high as $20,000.
What does earthquake insurance cover?
Most policies will cover damage to your home and personal property caused by an earthquake. However, they typically won’t cover damage caused by aftershocks or flooding that occur because of the earthquake.
What’s the risk of an earthquake in your area?
If you live in an area with a high risk of earthquakes, you may be more likely to need earthquake insurance than someone who lives in an area with low risk.
Ultimately, whether to purchase earthquake insurance is up to you. But it’s important to do your research and make sure you understand all the risks and benefits.
PROS & CONS OF EARTHQUAKE INSURANCE
While earthquake insurance offers financial protection in the event of damage, there are also downsides to consider. Here are a few pros and cons to help you decide if earthquake insurance is worth it for you.
Pros of Earthquake Coverage
One advantage of earthquake insurance is that it can cover the cost of repairs or replacements if there were damages to your home. This can be helpful if you live in an area prone to earthquakes or if your home is vulnerable to damage. Many earthquake insurance policies also cover belongings, such as furniture and appliances.
Cons of Earthquake Coverage
Earthquake insurance can be costly. Premiums can be expensive, especially in areas at high risk for earthquakes. Plus, deductibles for earthquake insurance policies are often much higher than those for standard homeowners insurance policies.
This means that you may have to pay a significant amount out of pocket before your coverage kicks in. When deciding whether to purchase earthquake insurance, it is essential to weigh the costs and benefits carefully.
If you live in an area at high risk for earthquakes, you should strongly consider getting an earthquake insurance policy.
If you need help finding the best earthquake insurance coverage for the best price, start by speaking to a SimplyIOA agent at 833.872.4467 or get an earthquake insurance quote online now.
