Homeowners' Insurance: Getting Earthquake Coverage

Most standard homeowners' insurance policies don’t include coverage for damage done by earthquakes. Proper earthquake coverage can give you the funds you need to repair your home in the event that this natural disaster strikes your town.

Evaluating Earthquake Insurance Policies

Depending on the policy you select, only certain structures may be covered. Ideally, you should look for a policy that includes damage to the home itself, damage to the items within the home, damage to unattached structures (such as a garage or outbuilding) and living expenses in the event that you must relocate while the property undergoes repairs.

Earthquake Insurance Beneficiaries

If your lender stipulates in your loan contract that you must obtain earthquake insurance, the lender may have a claim to the payout in the event that earthquake damage occurs. Talk to your insurance company before purchasing your insurance to ensure that the insurance funds would be mailed directly to you and not require endorsement by your lender before you could access them. This could stall the repair process.

How Much You’ll Pay

Your insurance company will evaluate a variety of factors when determining how much you’ll pay for your policy. One important factor is the area you live in. The more likely your area is to suffer an earthquake, the more earthquake insurance will cost you. Another price variable is the value of your home. The larger and more expensive your home is, the more you’ll have to pay to insure it against earthquake damage.