According to studies, people who live in the western parts of U.S. are usually more conscious of the risks caused by earthquakes. In west coast states like California, people tend to be more aware of the availability of earthquake insurance than residents of other states in the U.S. However, statistics received from the California Earthquake Authority show that despite the increased public knowledge about the risk of earthquake, only 10% of Californians purchase earthquake insurance. This means that the rest 90% of the population does not have coverage. In fact, most people risk their property and their life while supposing that if the last earthquake did not cause damage to their home, the next one will probably not do as well.
So if you don’t have earthquake insurance yet, and you’re questioning whether it’s worth buying, then you are in the right place. We made a list of things you’ll usually get when purchasing earthquake insurance and it is up to you to decide whether it is worth buying or not.
Repairs & Reconstruction
If your home gets damaged because of an earthquake, your insurance will cover the cost of the repairs or reconstruction. Meanwhile, without having earthquake insurance, you risk losing everything or having to borrow money to pay for all the expenses on your own because a major earthquake can potentially leave you without a home.
If you live in a lower-risk area, your earthquake insurance premiums will be much lower than in high-risk areas. In fact, you might be able to buy a policy for as little as $20 per month. It is especially beneficial for those who doubt purchasing earthquake insurance as they get to see it in practice for a month before making their final decision about it.
Lower premiums are offered not only to residents of lower-risk areas but also to those who have wood-frame homes. It is because those type of houses typically withstand earthquakes better. On the contrary, higher premiums will be offered to homeowners who have brick or masonry houses that are not able to move with the land when there is a quake.
Additional Living Expenses
If your home becomes uninhabitable due to an earthquake, your insurance might pay for your additional living expenses to live elsewhere while your house is repaired or reconstructed. This means that if you’re still paying your mortgage for your destroyed home, at least someone else is paying for a place you live.
If you get comprehensive earthquake insurance policy, it will also ensure your expensive possessions such as jewelry, electronics, collections and much more.
Read more about earthquake insurance here.