Earthquake Insurance: What You Need to Know

Coverage and Premiums

Earthquake insurance typically covers up to the same amount as your dwelling value, as determined by your homeowners insurance policy. It utilizes parametric insurance, where premiums are calculated based on your proximity to earthquake zones, and claims are paid out accordingly.

Benefits

In addition to covering your home, earthquake insurance also protects your personal belongings and may include additional living expenses if you're unable to live in your home after an earthquake.

Importance

As witnessed in past events, earthquakes can cause significant damage and disruption. Carrying earthquake insurance, alongside your regular home insurance, ensures financial protection in the unfortunate event of an earthquake.

Prevalence

In areas at high risk for earthquakes, such as Los Angeles, earthquake insurance is crucial. According to the Department of Insurance, only about 21% of homeowners in Los Angeles have earthquake insurance coverage.