Earthquake coverage: Should I get it?

Since January of 2009, earthquakes have been on the rise in Oklahoma with an estimate of 40 per year. Due to the recent increase in earthquakes, many Oklahomans have been asking whether or not they need earthquake insurance. Earthquakes are not covered under your typical home owner’s policy. If your insurance company offers earthquake coverage, it can be added as an endorsement to your current coverage. It is also available as a stand-alone policy separate from your current home insurance.

Earthquake insurance covers home repairs and personal property directly damaged by an earthquake. Most policies will also cover damage to your masonry veneer but not all companies offer this. Be sure to have your agent verify if this is covered.

The cost to add earthquake coverage is typically small and is determined by the amount of coverage you choose and the deductible. The deductible is usually a percentage of the insured’s dwelling value ranging from 2%-20%. The deductible amount is important for this coverage because it is higher than your normal deductible for the other perils. This makes earthquake coverage a catastrophic coverage. If you have minor damage to your dwelling from an earthquake, the damage may not exceed your deductible. However, if you have extensive damage, you will be very happy that you have this coverage, since it is typically excluded under your standard homeowners policy.
If you are interested in obtaining earthquake insurance, you should first call your current insurance company or agent and see if you can add it to your existing policy. This may cost you anywhere from $50 to $200 annually to add this coverage. If your current carrier does not provide earthquake insurance, give us a call and we can provide you with an earthquake quote from one of our carriers that will write a stand alone earthquake policy. This could cost you anywhere from $200 to $500 annually depending on the amounts of coverage that you request.

In the end, each person has to make a cost benefit analysis of their property and coverage. Is $500 or less annually worth the peace of mind of having coverage for an event that very well could happen here in Oklahoma?