Earthquakes strike without warning. And when they do, the damage can be devastating. Like other types of coverage, this isn’t a one-size-fits-all decision. Knowing when it makes sense and when it doesn’t depends on several factors, including your home’s location, design, and value.
Earthquake Insurance Isn’t Automatically Included
Most standard homeowners and renters’ policies don’t cover earthquake damage. If you want coverage, you usually need to buy a separate earthquake insurance policy. Some providers offer it as an add-on, but not all do. The coverage usually pays for repairs to your home, personal belongings, and sometimes temporary living expenses if your house becomes uninhabitable.
Before considering earthquake insurance, first check what your current policy covers. You might be surprised at what’s missing.
Where You Live Matters the Most
Geography plays the biggest role in deciding whether earthquake insurance is worth it. If you live in California, Alaska, Washington, or near a known fault line, your risk is much higher than in places like Florida or the Midwest.
Even within one state, some areas face higher seismic risks than others. For instance, in California, the San Andreas Fault raises more concerns than in other regions. The U.S. Geological Survey highlights several indicators you should consider:
- How close you are to active earthquake faults
- How often earthquakes hit your region
- When the last major quake occurred
Some areas may have gone years without a serious quake, but that doesn’t mean they’re safe.
What Kind of Home You Have Also Matters
Your home’s design can affect how well it stands up to an earthquake. Brick and concrete homes tend to crack and crumble faster than wooden ones. Homes built before modern building codes might lack the reinforcements needed to resist seismic activity.
You also need to think about the foundation. Experts also recommend checking whether your home’s designer included earthquake resistance in the structure. If they didn’t, your home could face more damage when the ground shakes.
Not All Sites Are Equal
The land beneath your home is as important as the home itself. Loose soil, landfills, and sloped lots pose a higher risk for damage. Areas with poor drainage or heavy rainfall can also suffer more during an earthquake. Wet soil shakes differently, which can increase the chance of structural failure.
What It Covers and What It Doesn’t
Earthquake insurance usually includes three parts: repairs to your home, personal belongings, and loss of use. But coverage limits and rules vary. Most policies don’t cover damage to land, pools, fences, or detached garages.
Deductibles are another key concern. Instead of a flat amount, earthquake policies use a percentage of your home’s value. That means if your home is worth $500,000 and your deductible is 15 percent, you’ll pay $75,000 before coverage starts.
So, should I buy earthquake insurance with a high deductible? Only if you can afford to cover the gap or risk going without protection.
Costs vs. Risk: Doing the Math
Like any insurance, the decision to buy comes down to weighing cost against potential loss. Earthquake insurance premiums vary based on location, home value, construction type, and other risk factors.
If you live in a high-risk zone and couldn’t afford to rebuild out of pocket, the policy might be a financial lifeline. But if you’re in a low-risk area and your home is built to modern codes, you might choose to skip it.
You may want an expert opinion before deciding. While the USGS doesn’t make recommendations, your homeowner’s insurance agent can help you understand your options.
Think Beyond the House
When considering the worth of earthquake insurance, don’t forget your belongings. Many policies allow you to cover personal property like electronics, furniture, and appliances. If a quake strikes and you lose it all, replacing everything adds up fast.
Also, consider your daily needs. Would you have a place to stay while your home is being repaired? If not, the “loss of use” coverage in earthquake insurance becomes even more important.
When You Probably Don’t Need It
Not everyone needs earthquake insurance. If you live in an area with little or no seismic activity, you might choose to save your money. Homes built on solid bedrock using strong materials and updated codes face lower risks.
Also, if you could pay for repairs or rebuild without taking a major financial hit, you might not need the added coverage. Still, it helps to do a quick cost-benefit analysis before ruling it out entirely.
When the Ground Settles, What Will You Stand On?
Earthquakes don’t give warnings, but they do leave lasting consequences. Insurance won’t stop the shaking, but it could help you regain your footing. Whether you choose coverage or take the risk, make sure you’re standing on a decision you won’t regret.