Earthquake insurance policies include coverage for earthquake related losses and does not provide coverage for losses attributable to other perils that may be covered under your home owner policy.
1. Mark Strauss
Shake, Rattle, & Roll
Architectural Heritage Center
EARTHQUAKE INSURANCE
INDEPENDENT INSURANCE ADVISOR
www.oregoninsuranceadvisor.com
503 – 922 - 4847
2. What Is Insurance?
An agreement in which a person makes regular
payments to a company and the company promises
to pay money if the person is injured or dies, or to
pay money equal to the value of something (such
as a house or car) if it is damaged, lost, or stolen. Merriam Webster
3. Will my existing home insurance
policy provide coverage due to a loss
as a result of an earthquake?
5. Earth Movement is
Specifically excluded from
coverage.
Earthquake insurance policies include
coverage for earthquake related losses and
does not provide coverage for losses
attributable to other perils that may be covered
under your home owner policy.
6. The 3 Rules of Risk Management
Rule #1
Don’t Risk More Than You Can Afford To Lose
7. The 3 Rules of Risk Management
Rule #2
Consider The Odds
8. The 3 Rules of Risk Management
Rule #3
Don’t Risk A Lot for A Little
9. What Does Earthquake Insurance Protect?
Earthquake insurance will cover
the following:
Rebuilding your home and other structures
Replacing your personal property
Providing additional living expenses
*You need to verify the policy contract for the protection
being
offered.
10. Insurance Company definition of
‘Earthquake’:
“Means shaking or trembling of the earth, whether
caused by volcanic activity, tectonic processes or any
other cause. One or more earthquake shocks that
occur within a seventy-two hour period shall
constitute a single earthquake.” – Safeco Earthquake Insurance
An “occurrence” means loss to covered property due
to earthquake shocks that occur within a continuous
72 hour period. This would include land shock waves
or tremors before, during, or after a volcanic eruption
as well. After this 72 hour period another seismic
event would constitute the use of another earthquake
deductible.
11. Earthquake Insurance Deductibles
A deductible will apply separately to losses under
the following coverages:
Coverage A: Dwelling
Coverage B: Other Structures
Coverage C: Personal Property
The company will only pay the part of the loss after
the deductible has been met.
12. Earthquake Insurance Deductible Example
If your home is insured for $200,000 and
your earthquake insurance policy has a
10 percent deductible, you would have to
pay the first $20,000 in repair or
replacement costs before the insurance
company will pay for the remainder of
the repairs that are necessary.
13. What does it co$t?
Cost factors include:
Dwelling construction type
Dwelling replacement cost
Deductible chosen
15. Earthquake Insurance Eligibility
Requirements Might Include:
Not available on homes built prior to 1950 unless the home
has a new foundation
It must be bolted to the foundation
No more than 2 stories
No more than a 15 degree slope
Water heater must be strapped to the wall
The
The
The
The
The
The
home
home
home
home
home
home
cannot have an unsecured cripple wall
must sit on ground that meets soil requirements
cannot have a post & pier foundation
has a cement or tile roof
cannot be a log home
cannot be 100% masonry
16. Companies I Represent That Provide
Earthquake Insurance Include:
Allied Insurance
Capital Insurance Group
Chubb Insurance
Cincinnati Insurance
Fireman's Fund Insurance
Foremost Insurance
GeoVera Insurance
GuideOne Insurance
Kemper Auto & Home Insurance
Liberty Mutual Insurance
Lloyd’s of London
Oregon Mutual Insurance
The Hartford
Travelers Insurance
17. Do I Really Need Earthquake Insurance?
Consult The 3 Rules of Risk Management
Rule #1: Don’t Risk More Than You Can Afford To Lose
Rule #2: Consider The Odds
Rule #3: Don’t Risk A Lot for A Little
Editor's Notes
10 Years with Leonard Adams Insurance, an independent insurance broker in Portland, OR.
There are 2 types of insurance companies: Direct writers and Independents. Direct writers would be companies like Allstate, State Farm, Farmers, American Family, etc. Those agents represent only those companies and can provide the services of those companies. Independent insurance companies use brokers like myself to market their products and services. As a broker I provide access to a choice of options that will meet your needs.
Will my existing home insurance policy provide coverage due to a loss as a result of an earthquake?
No!
Standard home insurance policy contracts are going to specifically exclude earthquake and a loss due to flood & landslide as well.
This is a measure of severity. If you don’t have the financial resources to rebuild your home then what? There needs to be another way.
What is the probability that a loss will occur? An event with a greater likelihood of occurrence needs to be evaluated.
Weigh the cost of insurance compared to the potential out of pocket costs. Don’t self insure for a loss that can be insured for a relatively small amount of premium.
Not all policies provide the same coverage. Some might limit the amount of benefit provided for personal property and loss of use.
Each company has its own definition of earthquake. You can find out how a company defines what an earthquake is by reviewing the policy language under the ‘Definition’ portion of any insurance contract.
After the occurrence of an earthquake it is common for insurance companies to put a moratorium on offering coverage. This is usually for a period of 2-4 weeks.
Your earthquake deductible works as a stated percentage that can be from 10%, 15%, 20%, or 25%. This contrasts to a standard home insurance policy which has a dollar amount such as $500 or $1,000 for claims such as fire or theft.
rather than a
Most insurance companies provide earthquake deductibles from
Earthquake deductible example
Since different building materials react differently to earth movement (brick versus wood, for example), premiums vary by the type
Of construction of the building.
Not all companies offer earthquake insurance.
Not all companies offer earthquake insurance. Those that do offer insurance might have restrictions and eligibility requirements.
All companies rated in the A categories by AM Best.