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Most home insurance polices don’t cover damage from earthquakes – here’s how you can protect your home

Posted at 6:21 PM, Jul 08, 2019
and last updated 2019-07-08 21:21:22-04

Recent earthquake activity in California is prompting people to prepare for the next one. 

Some of that prep includes buying earthquake insurance.

You might be surprised to find out that most home insurance policies don’t cover damage from earthquakes.

On July 5, a 7.1 magnitude earthquake rocked the city of Ridgecrest. California’s largest quake in 20 years was felt by some people on the Central Coast.

One San Luis Obispo woman is glad she purchased earthquake insurance a few years ago.

“It’s a safeguard in case something happens but hopefully, nothing will,” said Michelle*, who owns earthquake insurance. 

Since Michelle lives in a condo, her earthquake insurance doesn’t cover everything, like shared walls. That’s up to a homeowners association to protect.

“It covers everything inside, but it doesn’t cover the walls adjoining to the unit next door.”

Since the shaking, insurance companies like State Farm say customers are thinking ahead.

“This one being as large as it was had people thinking, ‘what am I covered for?’” said Courtney Morrow, a State Farm agent in Templeton. 

Morrow says there are now more options when it comes to picking your deductible. 

“Before, you could either do a 10% deductible which means 10% of your dwelling amount,” said Morrow. “So if your house is $500,000 you would be paying a $50,000 deductible or 15% was the other option, but now you can go as low as 5%.”

If you bought earthquake coverage today, Morrow says it wouldn’t kick in until the next seismic event.

“You are covered; however, it’s not going to cover you for the past event from the Ridgecrest quake or the aftershocks so we are talking about a new event,” Morrow said. 

Others aren’t rushing to get covered. 

“If nothing happens in the next couple of years, I might think about it, but I’m not worried,” said Beau Dickinson, who doesn’t have earthquake insurance. 

Insurance agents say you can customize your policy by choosing a personal property and building code coverage. 

Morrow says the Central Coast has one of the lowest premiums for earthquake insurance in the state. 

“Insurance isn’t there because you know something is going to happen, it’s there in case something happens,” Morrow said.

Things like the size and location of your house can affect the amount you pay. 

Insurance agents say homeowners with a single-story house on a slab will likely pay less than someone who lives in a two-story home on an elevated foundation.

To find out how much earthquake insurance would cost for your home, click here.

*Michelle did not want her last name used in this story.