Earthquake insurance is a special type of coverage that isn’t included in standard homeowners or renters insurance policies.
You aren’t required to purchase earthquake coverage, but it may be a good idea if your state has a high risk of earthquakes. Alaska, California, Hawaii, Nevada, and Washington are the five states that experience the most earthquakes.1
Learn more about earthquake insurance and how to protect your home in the event of disaster.
The cost of earthquake insurance can vary widely depending on where you live. Here are the biggest factors affecting the average cost of earthquake insurance:
Location: People living in high-risk areas for earthquakes will pay more for earthquake insurance. All 50 states have the potential for earthquake activity, but Alaska and California have the most. California has earthquakes that cause more damage than in any other state, and residents will pay higher insurance rates.2
Deductible: Insurance companies usually set earthquake insurance deductibles at a percentage, not a dollar amount, unlike most other types of insurance. The deductible can range from 2% to 20% of the structure’s replacement value. Most insurers set the minimum deductible at 10% for customers in higher-risk states like Washington, Nevada, and Utah.3
Coverage limits: Choosing higher coverage limits will give you more financial security, but it’ll also increase the cost of earthquake insurance.
Home build: Your insurance company bases your premiums on the type of structure and material used. For example, older homes cost more to insure, and brick homes cost more than frame structures because they’re more vulnerable to disaster.
If you’re considering earthquake insurance, it’s important to understand what it covers and what it doesn’t. Your exact coverage can vary depending on your insurer, but here are the main things earthquake insurance covers:4
Earthquake insurance doesn’t cover every natural disaster and excludes the following perils:
You might assume you don’t have to worry about earthquake insurance unless you live in California. But earthquake activity can happen in all 50 states, and the following states have the highest likelihood of experiencing an earthquake:
Alaska
Arkansas
California
Hawaii
Idaho
Illinois
Kentucky
Missouri
Montana
Nevada
Oregon
South Carolina
Tennessee
Utah
Washington
Wyoming
You should consider several factors if you’re wondering whether you should get earthquake insurance. First, consider your proximity to active faults and the seismic activity in your area. You can use the United States Geological Survey to determine your proximity to fault lines.
The building construction, layout of your home, and slope of the land are also things to take into account.5 Certain types of homes, types of ground, and other geological factors can make your home more high-risk. It’s a good idea to talk to your insurance agent and have them evaluate your level of risk.
To determine how much earthquake insurance you need, start by estimating the replacement cost of your home. The square footage, the age of your home, its features, and its foundation affect the replacement cost.
You also want to create a home inventory and estimate the value of your personal belongings. Finally, consider how much it would cost to pay for additional living expenses if your home were temporarily unlivable. Without earthquake insurance, you’ll be responsible for covering all these expenses on your own.
Ask an insurance agent or broker for recommendations on how much coverage you should purchase. And it’s a good idea to re-evaluate your coverage annually to ensure you aren’t over or underinsured.
If you’re still on the fence about earthquake insurance, check out this additional information to help you decide.
If you live in an area with a high earthquake risk, earthquake insurance is worth it. This insurance will cover your home’s structure, your personal belongings, and any additional living expenses after an earthquake. Without this coverage, you’ll be stuck paying these costs on your own.
The cost of earthquake insurance depends on a variety of factors. You’ll pay more for earthquake insurance if you live in a state at high risk for earthquakes.
No. A standard home insurance policy doesn’t cover earthquake damage. You can purchase earthquake coverage as an endorsement if your home insurance company offers it, or you can buy a separate earthquake insurance policy.
The cost of earthquake insurance depends on your location, deductible, coverage limits, and home build. For example, you’ll pay more for coverage if you live in a state at high risk for earthquakes. Choosing a higher coverage limit will also come with higher annual premiums.
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