Should you purchase earthquake insurance for your home? That is a question that we hear often because homeowners insurance companies in California are required to offer
USGS Earthquake Map
earthquake insurance to their policy holders. You will always receive an offer when you write a new policy and at least every other year after that.
Should you take that offer?
You should make that decision based on the following 2- questions:
Could an earthquake destroy my house?
Would a earthquake destroying my home cause me to go bankrupt or have great financial pain?
Both of those answers are clearly; YES! If you live in the Western United States we are always waiting for the “big one” that would destroy our home in seconds. The damage or destruction of your home would cause the vast majority of us to go bankrupt or have great financial pain in trying to recover.
“Isn’t Earthquake Insurance very expensive”? Earthquake insurance rates have been falling in recent years and are quite affordable. Most homes in California can be insured for earthquake coverage for a few hundred dollars per year. Insurance Companies tend to have short memories and the Northridge Earthquake in 1994 was the last major earthquake event in California. In fact the Northridge Earthquake completely reshaped the California home insurance market with as much as $25,000,000,000 in damages.
“Isn’t Earthquake Insurance very limited in what it covers”? As rates have fallen, the coverage offerings have also improved. You can now purchase a policy with a lower 10% (as opposed to 15%) deductible, increased coverage for personal property, loss of use and building code upgrades.
“How do I purchase coverage”? Most earthquake insurance is required to be written through your homeowners insurance policy. Many companies allow you to purchase earthquake insurance at any time during your policy (prior to a loss of course). Some companies only allow you to start an earthquake policy when they offer it each or every other renewal.
“If I have a big loss and my home is destroyed I am sure the state or federal government will help me to rebuild”. It is actually a very common response when talking about earthquake insurance. We help our customers protect themselves and their families and it certainly is not prudent to “hope” that the government will step in to help when you need them.
If you have questions you can talk to us by phone 661-327-5531 or by email at firstname.lastname@example.org. You can also complete an instant quote here.