Jamie is a meticulous researcher who has published 2,000+ personal finance articles. Her expertise is trusted by major brands like Bankrate and Rocket Mortgage.
Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.
Outside of work, Sara is an avid reader, and loves rock climbing, yoga, and crocheting.
Updated September 4, 2024 | Reading time: 4 minutes
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You aren’t required to purchase earthquake coverage, but it may be a good idea if your state has a high risk of earthquakes. Alaska, California, Hawaii, Nevada, and Washington are the five states that experience the most earthquakes.[1]
Learn more about earthquake insurance and how to protect your home in the event of disaster.
How much earthquake insurance costs
The cost of earthquake insurance can vary widely depending on where you live. Here are the biggest factors affecting the average cost of earthquake insurance:
Location: People living in high-risk areas for earthquakes will pay more for earthquake insurance. All 50 states have the potential for earthquake activity, but Alaska and California have the most. California has earthquakes that cause more damage than in any other state, and residents will pay higher insurance rates.[2]
Deductible: Insurance companies usually set earthquake insurancedeductibles at a percentage, not a dollar amount, unlike most other types of insurance. The deductible can range from 2% to 20% of the structure’s replacement value. Most insurers set the minimum deductible at 10% for customers in higher-risk states like Washington, Nevada, and Utah.[3]
Coverage limits: Choosing higher coverage limits will give you more financial security, but it’ll also increase the cost of earthquake insurance.
Home build: Your insurance company bases your premiums on the type of structure and material used. For example, older homes cost more to insure, and brick homes cost more than frame structures because they’re more vulnerable to disaster.
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What earthquake insurance covers
If you’re considering earthquake insurance, it’s important to understand what it covers and what it doesn’t. Your exact coverage can vary depending on your insurer, but here are the main things earthquake insurance covers:[4]
Dwelling coverage
Dwelling coverage pays to repair or replace the structure of your home after an earthquake. It may also cover attached structures, like a garage.
Personal property coverage
Earthquake insurance also covers your personal property, like clothing, furniture, and electronics.
Loss of use coverage
An earthquake policy also covers your additional living expenses if your home is uninhabitable due to damage. Loss of use coverage could include temporary living arrangements, food, and other necessary items during home repairs.
What earthquake insurance doesn’t cover
Earthquake insurance doesn’t cover every natural disaster and excludes the following perils:
Fire
Earthquake insurance doesn’t cover fire damage, even if an earthquake causes it. Standard homeowners insurance covers fire damage.
Land
Earthquake insurance doesn’t pay for damage to your land, like sinkholes or erosion.
Vehicles
It also doesn’t cover damages to your vehicles — your auto insurance policy covers these costs if you have comprehensive coverage.
Flooding
Earthquake insurance doesn’t cover water damage or flooding, so you’ll need to purchase a separate flood insurance policy.
Who needs earthquake insurance?
You might assume you don’t have to worry about earthquake insurance unless you live in California. But earthquake activity can happen in all 50 states, and the following states have the highest likelihood of experiencing an earthquake:
Alaska
Arkansas
California
Hawaii
Idaho
Illinois
Kentucky
Missouri
Montana
Nevada
Oregon
South Carolina
Tennessee
Utah
Washington
Wyoming
You should consider several factors if you’re wondering whether you should get earthquake insurance. First, consider your proximity to active faults and the seismic activity in your area. You can use the United States Geological Survey to determine your proximity to fault lines.
The building construction, layout of your home, and slope of the land are also things to take into account.[5] Certain types of homes, types of ground, and other geological factors can make your home more high-risk. It’s a good idea to talk to your insurance agent and have them evaluate your level of risk.
California earthquake insurance
If you live in California, it’s a matter of when, not if, you experience an earthquake. California experiences 90% of the country’s earthquakes, but only 10% of residents have earthquake insurance.[6]
In California, insurance companies must offer to sell you earthquake insurance every year. The California Earthquake Authority (CEA) provides the majority of California earthquake coverage in the state.
Good to Know
The CEA is a not-for-profit organization that insures more than 1 million Californians. The CEA offers several policies, and you can purchase a policy from one of its participating members.
How much earthquake insurance you need
To determine how much earthquake insurance you need, start by estimating the replacement cost of your home. The square footage, the age of your home, its features, and its foundation affect the replacement cost.
You also want to create a home inventory and estimate the value of your personal belongings. Finally, consider how much it would cost to pay for additional living expenses if your home were temporarily unlivable. Without earthquake insurance, you’ll be responsible for covering all these expenses on your own.
Ask an insurance agent or broker for recommendations on how much coverage you should purchase. And it’s a good idea to re-evaluate your coverage annually to ensure you aren’t over or underinsured.
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Earthquake insurance FAQs
If you’re still on the fence about earthquake insurance, check out this additional information to help you decide.
Is earthquake insurance worth it?
If you live in an area with a high earthquake risk, earthquake insurance is worth it. This insurance will cover your home’s structure, your personal belongings, and any additional living expenses after an earthquake. Without this coverage, you’ll be stuck paying these costs on your own.
How much does earthquake insurance usually cost?
The cost of earthquake insurance depends on a variety of factors. You’ll pay more for earthquake insurance if you live in a state at high risk for earthquakes.
Does most homeowners insurance cover earthquakes?
No. A standard home insurance policy doesn’t cover earthquake damage. You can purchase earthquake coverage as an endorsement if your home insurance company offers it, or you can buy a separate earthquake insurance policy.
What factors influence the cost of earthquake insurance?
The cost of earthquake insurance depends on your location, deductible, coverage limits, and home build. For example, you’ll pay more for coverage if you live in a state at high risk for earthquakes. Choosing a higher coverage limit will also come with higher annual premiums.
Jamie Johnson is a Kansas City-based personal finance writer whose work has been featured on several of the top finance and business sites in the country, including Insider, Credit Karma, Bankrate, Rocket Mortgage, Fox Business, Quicken Loans, and The Balance. For the past six years, she's dedicated more than 10,000 hours of research and writing to more than 2,000 articles about personal finance topics.
Jamie has been a contributor at Insurify since October 2022.
Sara Getman is an Associate Editor at Insurify and has been with the company since 2022. Prior to joining Insurify, Sara completed her undergraduate degree in English Literature at Simmons University in Boston. At Simmons, she was the Editor-in-Chief for Sidelines Magazine (a literary and art publication), and wrote creative non-fiction.
Outside of work, Sara is an avid reader, and loves rock climbing, yoga, and crocheting.
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