Earthquake Insurance discounts and questions
Pays to repair a home and replace its contents after earth movement, which every standard home policy excludes. Written as a standalone policy or an endorsement, with a deductible set as a share of the dwelling limit rather than a flat amount, which is the number to understand before buying.
Discounts carriers commonly offer
- Retrofitted foundation
- A home bolted to its foundation with braced cripple walls, documented by a contractor or an inspection, earns the largest credit.
- Newer wood-frame construction
- Homes built to modern seismic codes with wood framing and no masonry veneer are rated lowest.
- Strapped water heater and gas shutoff
- Some carriers credit an automatic gas shutoff valve and a strapped water heater, which also prevent the fire that follows a quake.
- Higher deductible
- Moving from the lowest available share to a higher one is the main lever on price.
- Same-carrier endorsement
- Adding earthquake to the home policy with the same carrier is often cheaper than a standalone policy, at the cost of the standalone's terms.
Questions people ask
I live on the Wasatch Front. Is this coverage worth it?
For an owner of an unreinforced brick home on the valley floor with a mortgage, it usually is, because the loss that could occur is the whole house plus the loan on it. For a newer wood-frame home on the bench, the expected damage is far smaller and the coverage is a closer call. The analysis puts the deductible in dollars against the equity at risk and the premium, and the honest answer for some households is to retrofit first and insure second.
Why is the deductible so large?
Because a damaging quake hits every insured home in a region on the same day, and a carrier that paid small claims on all of them would not survive to pay the large ones. The percentage deductible keeps the coverage priced for the catastrophic loss, which is the one that matters. A lower deductible is available at a higher premium, and whether it is worth buying depends on how much repair you could absorb yourself.
Does my home policy cover anything after an earthquake?
Fire and explosion following a quake are covered by most home policies, and so is theft from a damaged home. Water damage from a broken supply line inside the house is often covered too. The shaking damage to the structure and contents is not, and neither is the landslide or ground failure that follows.
How does the aftershock rule work?
Policies define a single occurrence as the initial quake plus every aftershock within a stated number of hours afterward, so one deductible applies to all of them. A separate quake after the window closes is a second occurrence with a second deductible. The window varies by carrier and is on the declarations page.
Can I buy earthquake coverage after a quake?
Carriers stop writing new earthquake policies for a period after a significant event, and some suspend the whole region while aftershocks continue. Coverage bought in a quiet year is the only kind that is reliably available.
Does earthquake insurance cover my condo?
A condo owner's earthquake policy covers the interior finishes, contents, loss of use and the owner's share of a loss assessment when the association's master policy has a large deductible or no earthquake coverage at all. The master policy question comes first, because many associations carry a high deductible or none, and that assessment lands on every unit owner.