According to the US Geological Survey, over 143 million Americans reside in areas with significant earthquake shaking hazards. Yet despite the potential for total foundation destruction, less than 10% of California homeowners and under 15% of Pacific Northwest homeowners carry earthquake insurance.
Why Standard Homeowners Policies Exclude Earthquakes
Standard HO-3 homeowners insurance policies explicitly exclude earth movement, fault slipping, settling, and seismic shaking. (Note: Fire resulting from ruptured gas lines after an earthquake IS covered under home policies under the “fire following” doctrine).
How Percentage-Based Earthquake Deductibles Function
Unlike auto insurance where deductibles are fixed dollar figures (e.g. $500 or $1,000), earthquake insurance deductibles are expressed as a percentage of your Dwelling (Coverage A) policy limit (typically 5%, 10%, 15%, or 25%):
Seismic Retrofitting Discounts for Older Homes
For pre-1979 raised foundation homes, completing a certified seismic retrofit (bolting the wood-frame house to its concrete foundation and bracing cripple walls with plywood) can reduce annual CEA earthquake insurance premiums by up to 25% to 35%!
Frequently Asked Questions
Q: Does earthquake insurance cover personal property inside my home?
A: Yes! Modern CEA and standalone policies offer separate personal property limits (up to $200,000) with a low or $0 deductible once the primary event threshold is triggered.