Earthquakes are a real and serious danger here in the Bay Area, and while they may be unpredictable, that’s no reason to leave yourself unprotected.
In this article, we’ll take a comprehensive look at earthquake insurance. What is it? What does it cover? How much does it cost? We’ll answer all of your questions and help you decide if earthquake insurance is right for you.
What Is Earthquake Insurance?
Earthquake insurance is a type of property insurance that helps protect homeowners and businesses from losses resulting from earthquakes. Policies typically cover the cost of repairing or rebuilding a property that’s been damaged by an earthquake, as well as the cost of any contents that may have been damaged or destroyed.
Most homeowners’ insurance policies do not include coverage for earthquakes, so it’s important to purchase a separate policy if you live in an area that’s prone to earthquakes. Businesses should also consider purchasing earthquake insurance, as it can help protect them from losses resulting from business interruptions or property damage.
Who Should Consider Earthquake Insurance
Earthquake insurance is not mandatory in most parts of the United States, but it’s still something that every homeowner should consider. Earthquakes can cause a lot of damage, and if you don’t have insurance, you’ll be left footing the bill yourself.
That’s why it’s important to weigh the risks and benefits of earthquake insurance before you decide whether or not to buy it. For some people, the risk is too high and they would rather roll the dice and hope they don’t experience an earthquake. But for others, the peace of mind that comes with knowing they’re covered in case of an earthquake is well worth the cost.
What Does Earthquake Insurance Cover?
The biggest question on everyone’s mind is what earthquake insurance covers.
While the specifics of each policy will vary, earthquake insurance typically covers damage to your home and belongings, as well as additional living expenses if you’re forced to leave your home. This could include hotel stays, food, and other costs associated with dislocation.
It’s important to note that earthquake insurance does not cover the cost of repairing or rebuilding your home—that’s what your homeowners policy is for. But it can help you cover some of the expenses associated with a major earthquake, which can add up quickly.
The Cost of Earthquake Insurance
Another reason that people might not have earthquake insurance is because of the cost. And I get it—no one wants to pay for something that they might never use.
But here’s the thing: the average cost of earthquake insurance is about $700 per year. And while that might seem like a lot, it’s actually not when you compare it to the potential damage that could be caused by an earthquake.
Remember, we’re talking about an event that could completely level your home. And the average cost of rebuilding a home from scratch is about $200,000. So even if you never need to use your earthquake insurance, it’s still a wise investment.
How an Insured Can File a Claim After an Earthquake
If you’re lucky enough to have earthquake insurance, then you’ll need to file a claim with your insurance company as soon as possible after the quake. The first thing you’ll need to do is take pictures of the damage, if it’s safe to do so. These will be used to help assess the damage and process your claim.
Then, you’ll need to contact your insurance agent or broker and let them know what happened. They’ll likely ask you for the same information that you took pictures of, so it’s helpful to have that ready. They’ll also need your contact information so they can reach you to discuss your claim.
Once you’ve filed your claim, an adjuster will be assigned to you and they will contact you to schedule an inspection. During the inspection, they will assess the damage and give you an estimate of what it will cost to repair or replace your damaged belongings.
If you’re not happy with the adjuster’s estimate, you can hire your own contractor to give you a second opinion. Once you’ve
reached an agreement on the cost of repairs, your insurance company will issue a check for the repairs or replacement cost, minus your deductible.
Tips for Shopping Around for Earthquake Insurance
Now that you know a bit more about earthquake insurance, it’s time to start shopping around for a policy. Here are a few tips to keep in mind:
– Check with your home insurance company first. Some home insurance policies include coverage for earthquakes, or you may be able to add it on for an additional premium.
– Consider the location of your home. If you live in an area that’s prone to earthquakes, you’ll likely pay more for earthquake insurance than someone who lives in an area that’s not at risk.
– Know what your policy covers. Some policies only cover damage to your home, while others may also cover personal belongings and living expenses if you need to evacuate.
– Read the fine print. As with any insurance policy, be sure to read the fine print so you know exactly what’s covered and what’s not.
Shopping for earthquake insurance can seem like a daunting task, but it doesn’t have to be. By following these tips, you’ll be on your way to finding the right policy for you and your family.
Although earthquakes are unpredictable, you can take some simple measures to protect yourself and your family financially. Earthquake insurance is one way to financially protect yourself from the risks of an earthquake, and it’s important to understand what earthquake insurance covers in order to make the best decision for your family.