California is the land of dreams, beaches covered with sun rays, shining lights of Hollywood, and impressing opportunities of Silicon Valley, and gorgeous landscapes. However, the cause behind all that beauty is a great risk: earthquakes. California is located along the San Andreas fault, and so the state is one of the most earthquake prone nations across the globe. According to experts, it is not a matter of when the next big quake will occur, but a matter of how soon.
The big question most homeowners pose is now:
Does home insurance cover earthquakes in California?
In a nutshell: No, basic home insurance DOES NOT cover earthquakes. And that is the reality of many Californians that is found too late.
In this blog, I will unpack what exactly is covered, why earthquake insurance in California is a necessity, and how you can ensure you are covered your family, your home, and your financial future.
Here there is the Harsh Reality of Earthquake Risk in California
Life in California implies life with earthquakes. The smaller tremors may cause:
Foundation cracks
Roof damage
Faulty plumbing or electricals
Structural instability
The “Big One” a possible massive earthquake on San Andreas Fault would result into billions in damages. In the absence of California earthquake insurance, homeowners can lose it all: house, money and sleep.
Does Normal Home Insurance Cover Earthquake?
The facts are as follows: California standard homeowners policies do not cover damage as a result of an earthquake.
What is covered? Fire, theft, a few water damages, windstorms and liability.
What is NOT included? Earthquakes/Landslides/Sinkholes.
This implies that when an earthquake cracks or breaks your foundation, does the same to your chimney, or harms your walls, your standard policy will not make any difference. You would have to pay out of pocket.
What Is Earthquake insurance in California?
You require a separate earthquake insurance policy to guard against damage by earthquakes.
This form of insurance normally covers:
Dwelling Coverage-Rebuilding or repairing your house.
Personal Property -Protects furniture, electronics, appliances and valuables lost due to an earthquake.
Loss of Use/Living Expenses - Covers hotel stays, rentals and food in case you can not live in your home.
Other Structures- The garage, fences, sheds and other property on your premises.
In California, a majority of the population buys the earthquake insurance either with the California Earthquake Authority (CEA) or privately.
Why Californians Don t Take Earthquake Insurance (and Why They are Wrong)
It is too costly.
I will never get it.
It is the government that will assist.
But this is the truth of it:
Federal disaster aid is typically in form of loans that you are required to pay back. Reconstruction in California may cost more than 300,000+ dollars.
Unless you are insured, you are likely to be bankrupt, foreclosed, or years of struggling financially.
Earthquake Insurance Cost in California
The expense is subject to:
The place you live (the nearer to fault lines, the higher the premium).
The age of the house (the older the house, the greater the risk).
Type of construction (the wood-frame homes are more efficient than the brick).
Yes, it seems expensive to pay the premiums but when weighed against the loss of the home, it is a saving investment of life.
Advantages of Earthquake Cover in California
Financial Protection- Rebuilding and repairs are covered.
Peace of Mind - get a better sleep knowing your house is secure.
Lodging costs covered-No running after a hotel or rent.
Family Stability -Saves your savings and your future.
Resale Value- The homes that are insured will be more appealing to buyers.
How to Save on Earthquake Insurance in California
Bundle Policies- Get Home, Earthquake and Auto Insurance savings.
Retrofit Your Home -By having your foundation, roof and chimney secured, you qualify yourself to get low rates.
The Bottom Line: Never gamble with your house
The California life is invaluable, however, so is your home and family safety. Earthquakes have not become a question of whether but when. In California, you cannot afford to be without earthquake insurance, because you could be ruined when the disaster comes.
The bottom line is then that, it is not simple home insurance that is sufficient. In order to fully safeguard your California dream, you must have earthquake coverage- before the ground again trembles.
