Do You Need Earthquake Insurance?

When considering the need for earthquake insurance the first question to ask yourself is, "Do I live in an earthquake prone area?" While an earthquake can occur in almost any area, certain areas are much more likely to experience this event compared to others. Do you live in the Mid-west or in Southern California? If you are in the former, you probably do not need to spend any extra money to add earthquake insurance. If you are in the latter or similar earthquake prone area you should now ask yourself a few more questions.

How frequent and high on the Richter scale earthquakes are in your area? The more frequent or severe, the more your need for insurance would be. In an area with few and/or minimal damage earthquakes you might be best off with a higher deductible or limited insurance. Look for a type that would cover only in the event of major home or household damage to save on additional payments.

What type of dwelling are you in and how dense are the residences?

Areas with residences or businesses built closely together can suffer more damage from the collapse of a nearby property than areas built with larger spaces between them. Older high rise apartment buildings can suffer significant damage. The age of the building should also be taken into account as newer construction will usually have safety features built in. While apartment dwellers do not have the need for building insurance of their own, they should be aware that most landlords do not cover personal property. A renter should consider how much they could lose in the event of an earthquake and what type of renter's coverage they should obtain.

What would the replacement costs be for your residential and personal property?

Obviously a mansion would require more coverage for replacement than a mobile home. The exact type of property and the style in which it is built will play a big part on the amount of insurance you would need to purchase. A bit of research on your type of property could go a long way in saving on your insurance payments. Your personal property should also be taken into consideration. If your residence is full of expensive, hard to replace and/or easily damageable items you should consider higher insurance protection with a lower deductible. If your personal property items are not in an expensive range you could go with less insurance and a higher deductible.

No matter what type of personal property you may have you do have options for lowering your replacement costs and therefore your insurance payments. Items hanging from walls and ceilings can be anchored properly to prevent them from falling in most moderate earthquakes. Glassware can be stabilized to prevent breakage. Electronics can be set on sturdier tables and be less likely to suffer damage than if placed on an already weak or wobbly surface. Some hardware stores may even have kits available for anchoring TV's and other electronics to lessen their movement.

Once you have considered all your personal variables you should come up with an idea on the amount of insurance and the deductible that is best suited for you.