Should you have earthquake insurance?

Maple Valley road 1965
Photo from King County Archives

We had a small rattler a couple of weeks ago. It wasn't The Big One, but it should have been a wake up call that we need to take some precautions for when a bigger one comes.

One of the things to consider is earthquake insurance.

For most people, their home is their greatest financial asset. Mortgagers require that you have homeowner's insurance but earthquake insurance is optional.

Earthquake damage is not covered under homeowner's insurance.

Earthquake insurance is an added endorsement to your existing homeowner or renter’s policy, or a separate earthquake policy you buy.

It provides coverage if your home is destroyed by an earthquake.

It's a separate endorsement you must buy and add to your homeowner or renter policy.

• You can also buy a stand-alone policy separate from your homeowner policy.
• It's usually sold with deductibles equaling 10 to 25 percent of the structure’s policy limit.
• It only pays for damages that exceed the deductible.
• There may be a separate deductible for contents, structure and unattached structures like garages, sheds, driveways, or retaining walls.

Generally, this coverage isn't available to buy for a period of time after an earthquake.

What it covers

• Repairs to your home
• Your personal property due to earthquake damage
• The cost to remove debris
• Extra living expense you might have while your home is repaired or rebuilt

What it might cover

• Increased costs to meet current building codes and costs to stabilize the land under your home
• Other structures not attached to your house

What it doesn't cover

• Fire
• Land
• Vehicles
• Pre-existing damage
• External water damage
• Damage due to:
• Landslides
• Settlements
• Mudflows
• Earth rising, sinking and contracting

What it might not cover

• Floods
• Tidal waves or tsunamis - even when caused by an earthquake

To see if you're covered or not for these types of damages listed above, talk to your agent or broker and be sure to read your policy.

What to expect from insurers
Some earthquake insurers may require an inspection of your property before they'll issue you a policy. They may even have different coverage requirements, such as:

• The location of your home
• Your home must be bolted to its foundation
• The location and bracing of your home's interior walls
• You must have strapping guards to secure fixtures, such as hot-water heaters

The last four are good advice, even if you choose not to purchase earthquake insurance. Bolting your home to its foundation and strapping guards for fixtures are relatively low cost compared to the cost of repairing damage caused by the lack of these precautions.

Talk to an agent and see what your options are.