Some people might be tempted to skip earthquake coverage unless they live in California. But earthquakes can impact most – if not all – states.The Insurance Information Institute says the entire Northwest U.S. is at high risk for earthquakes. Earthquakes are also a worry in several states along the New Madrid seismic zone within the central Mississippi River valley.
"If you live in an earthquake zone, you should realize that – as we saw after Hurricane Katrina – a government bailout could be long in coming and short on funding," says Pete Moraga, a spokesperson for the Insurance Information Network of California. "Homeowners should think about what they are doing to mitigate their exposure to the financial impact of an earthquake."
California earthquake insurance rules
Earthquake insurance rules are slightly different in California. There, earthquake insurance is available from private insurers and from the California Earthquake Authority, a privately funded, publicly managed organization.
Only 11.9 percent of California homeowners have earthquake insurance from either a private insurance company or CEA, according to the Insurance Information Network of California.
Moraga says the average annual premium for a CEA earthquake policy in 2009 was $707.
In California, the CEA policy excludes damage to swimming pools, spas, driveways, outbuildings, crystal, chandeliers and numerous other contents specified in the policy, Moraga says.
Moraga says that CEA policies cover structural damage up to the limit of the standard home insurance policy but limit contents coverage to $5,000 to $15,000 and loss of use coverage for living expenses to between $1,500 and $2,000. Private insurers in California may offer different coverage limits.
"If you live in an earthquake zone, you should realize that – as we saw after Hurricane Katrina – a government bailout could be long in coming and short on funding," says Pete Moraga, a spokesperson for the Insurance Information Network of California. "Homeowners should think about what they are doing to mitigate their exposure to the financial impact of an earthquake."
California earthquake insurance rules
Earthquake insurance rules are slightly different in California. There, earthquake insurance is available from private insurers and from the California Earthquake Authority, a privately funded, publicly managed organization.
Only 11.9 percent of California homeowners have earthquake insurance from either a private insurance company or CEA, according to the Insurance Information Network of California.
Moraga says the average annual premium for a CEA earthquake policy in 2009 was $707.
In California, the CEA policy excludes damage to swimming pools, spas, driveways, outbuildings, crystal, chandeliers and numerous other contents specified in the policy, Moraga says.
Moraga says that CEA policies cover structural damage up to the limit of the standard home insurance policy but limit contents coverage to $5,000 to $15,000 and loss of use coverage for living expenses to between $1,500 and $2,000. Private insurers in California may offer different coverage limits.
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