Only one in nine homeowners in California have earthquake insurance and considering that the chances of a large quake happening in the coming years is high, this could cause widespread uncovered damage. We are engineers who specialize in earthquake retrofitting. Earthquake retrofitting is the process by which your home, most frequently an older home, is made more able to withstand the forces of an earthquake. Retrofitting can include the installation of moment resisting frames around garage doors store windows, and shear walls to mitigate the risk to soft stories. To learn more about retrofitting and earthquake insurance in general, keep reading.

What deductible should I expect?

The deductible, or the amount of damage you pay out of pocket before your insurance kicks in, can vary from policy to policy. The higher the deductible, the lower your premium will be. This is because it can be assumed that if you deductible is, say, $60,000 you won’t make a claim for anything under than amount. This ensures that when a policy is collected on, the damage really is extreme. For earthquake coverage, the deductible is based on the overall policy limit, typically about 15% of your total. Remember that your premium is what you pay periodically so make sure your sticker shock, if you have it, is based on a year, not by the month.

Are personal possessions covered, as they are with Fire Insurance?

While personal items can be included in your claim, there is usually a very low dollar amount allocated to these items. Sometimes it can be as low as $5,000. If you have expensive items, such as weapons, art work, or jewels, you should consider getting a separate rider for them.

Could I be facing a total loss of my home?

Depending on several factors, you could be facing a total loss of your dwelling. These factors include the strength of the earthquake, your proximity to the epicenter, and if you live in an area prone to liquefaction. However, if you are farther away from the epicenter, you may have just masonry issues to deal with, such as a toppled fireplace.

Do I have other options?

Yes! You can get coverage through the California Earthquake Authority, a non-profit organization. In 1996, California Earthquake Authority was created by the California to step in where insurance companies had pulled out.

Is earthquake insurance too expensive for the payoff?

For a home that cost around $250,000 (and yes, this is inexpensive for this area, so feel free to scale up the costs), the deductible for earthquake insurance is $1200 a year and has a deductible of $60,000. Many people just can’t afford the extra cost and have no choice but to play the odds.

How can I lower my Earthquake Insurance costs

hoose a higher deductible. The higher your deductible, the lower your premium will be.  Skip the personal possessions policy. If you don’t cover the contents of your home in an earthquake policy, your premium will be lower. You can always cover individual valuable items in a rider. Have your home retrofitted. If you do you you may qualify for a Hazard Reduction Discount. This can save you up to twenty percent on your premium. Having your home retrofitted, which can include shear walls and moment resisting frames is a great way to mitigate the risk of loss from a medium-sized quake.

What else should I know?

One other important thing to know is that if your home is damaged by a fire that is caused by the earthquake, your home will likely be covered by your regular policy, and not the earthquake coverage. If your home is damaged by water as a result of the earthquake, such as a tsunami or sewage back up, this damage would fall under flood damage, and not the earthquake policy.

If you are interested in lowering your earthquake premium and strengthening your home or the soft story of your multi-unit building, call Consulting Engineers Corp. for an inspection and earthquake retrofitting.