CALIFORNIA EARTHQUAKE INSURANCE: WHAT will HOME INSURANCE cowl when A CATASTHROPIC?
Late Friday night, a 7.1 magnitude earthquake struck Southern California, the strongest temblor to hit the region in 20 years. The earthquake also happened one day after a 6.4-magnitude quake hit the state during the Fourth of July.
With the Independence Day quake, the recent spate of tornadoes and with hurricane and wildfire season upon us, you might be wondering how well would your homeowners or renter’s insurance will hold up in a natural disaster.
The answer largely depends on the disaster. Damage from many calamities are covered by a standard policy, but a handful are not and require separate coverage for protection.
For earthquakes, you must have a separate policy with a private insurer or, if your home in California, with the California Earthquake Authority.ia Earthquake Authority.
according to a study done in California by the Department of Insurance in July 2018, about 13% of California residents have earthquake insurance coverage in 2017.e coverage in 2017.
Even if your insurance covers the peril, it may not be enough. Many homeowners and tenants do not have the necessary protection to cover all their losses. And, because of the new tax reform law, uninsured losses can only be deducted in specific cases.
this is what you need to know about your insurance covering your house or apartment.
What damage does insurance cover?
Homeowners, condo and renter’s insurance cover damage sustained from most perils, including tornado, hurricanes, severe storms, rain, wind and fires. Homeowners insurance will pay to repair the structure of the property up to the insured amount and other detached structures like a garage or garden shed – typically around 10% of the main structure’s insured amount.
It also covers the property inside the house - in general, between 50% and 70% of what the structure of your house is insured. Landscaping elements such as trees and shrubs are generally reimbursed at about $500 per item, says Loretta Worters, a vice president at the Insurance Information Institute.
Condominium insurance covers property and some structural elements, such as drywall in the unit. The condo association’s insurance should cover damage to the building. Renter’s insurance only covers your possessions – often excluding appliances – but your landlord should have a policy that covers the structural elements of the apartment.
A major earthquake shook Thursday much of southern California and parts of Nevada. The nerves were shaken during the holidays of July 4th and caused a lot of damage in a city.th holiday and causing some damage in a town near the epicenter amid a swarm of aftershocks. (July 4) AP, AP
What damage is not covered?
Damage caused by floods and land movements, including earthquakes, landslides, and sinkholes, are not included in home, condo and tenant insurance.meowners, condo and renter’s insurance.
According to the California Department of Insurance, if you have homeowner’s insurance in the state your company must offer to sell you earthquake insurance too.
policies may also neglect specific weather conditions in some areas where they are common, such as windstorms in coastal states.
Homeowners, condo or renter’s policy will reimburse you for any additional living expenses you incur because you can’t live in your damaged home: costs like hotels, restaurant meals and laundromat expenses.
"These are costs that are higher than your usual costs," says Worters. “You can’t have an exorbitant restaurant bill. It comes with limits.”
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Any theft or damage done to your home by looters or vandals after a disaster is also covered by your homeowners, condo or renter’s policy.
What about your car?
If your auto insurance policy includes comprehensive coverage – which is not required by law – then your insurer will pay for costs to repair damage to your car from any risk, such as major weather events or simply a fallen branch.
Unlike home insurance, car insurance covers all floods and land movements.
Your auto insurance often will cover rental car fees while your car is repaired or replaced. In some cases, it’s not automatically included, so you have to purchase this coverage at an extra cost.
the California Institute of Technology's new study estimates that southern California suffers 495 small earthquakes every day, largely undetectable by humans. that are largely undetectable by humans. Veuer's Sam Berman has the full story. Buzz60
Insurance preparation
Your insurer only covers what he knows you have lost. That’s why it’s important to keep accurate records for filing claims in the future.
Be sure your insurance policy accurately describes your home - with the area, the number of rooms, the age and the materials that make it up.t’s constructed from. It should also account for any recent improvements – like a new roof or water heater – and upgrades – such as a room addition or new pool.
It’s also important to have an inventory of your possessions. It can be hard to remember what you owned in the emotional aftermath of a disaster, especially if you and your family are dealing with injuries or worse.
An easy way to take inventory in advance is to browse all the rooms and closets and record each possession on the video of your smartphone.e's video. If possible, observe the make and model of items, especially high-end devices.
Rare or expensive items such as art, collectibles or jewelry require additional coverage apart from your homeowners, condo or renter’s insurance, and must get appraised first before getting a separate policy.
Store your inventory record and insurer’s contact info somewhere besides your house or digitally where you can retrieve it at any time.
California earthquake insurance
Here are some things to know about California Department of Insurance earthquake insurance:
There are limits on what earthquake insurance pays. Earthquake insurance aims to help you rebuild your roof. It does not replace everything you lost.
For an estimate of your earthquake insurance premium, you must use the premium calculator available at www.earthquakeauthority.com.
To find out if you live where earthquakes are repeating, including fault lines nearby, search the US site Geological Survey website at https://earthquake.usgs.gov.
A house is likely to have more damage if it is older, or built of brick or masonry, or has more than one story.
If you can not afford earthquake insurance, the state says there are ways to protect your home and reduce the damage caused by earthquakes.uakes. It suggests retrofitting houses, securing breakable items with museum putting, bolting furniture, tying down computers and televisions.
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