If you live in a high-risk area and can’t afford to cover rebuilding costs after a major quake, earthquake insurance may be a wise investment to protect your finances.
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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A devastating earthquake could strike in nearly 75% of the United States, putting hundreds of millions of people — and their homes — at risk, according to a 2024 U.S. Geological Survey. Standard homeowners insurance won’t pay for repairs if an earthquake damages your house. Additional coverage is available, but you must determine if earthquake insurance is worth it.[1]
Before you rush out to buy an earthquake policy, understanding what it covers is crucial. Learn more about the key features of earthquake policies so you can decide whether it’s worth the cost for your situation.
Quick Facts
Earthquake insurance premiums cost an average of $800 annually.
Only 23% of homeowners have earthquake coverage.
Choosing a higher earthquake insurance deductible can help lower your rates.
What is earthquake insurance?
Earthquake insurance is a financial safety net to help you recover after quake damage, which standard homeowners insurance doesn’t cover. You can buy earthquake insurance as a separate policy or an add-on to your current coverage to protect your home and belongings against seismic events.
An earthquake can cause significant harm to a house, such as cracked foundations, buckled walls, and damaged roofs. It can also wreck personal belongings like furniture, electronics, and other household items. If tremors destroy your property and you don’t have earthquake protection, you may have to take out loans or use savings to cover the cost of repairs or rebuilding.[2]
What earthquake insurance covers
The aftermath of a seismic event can be extensive and costly, leaving you with significant out-of-pocket expenses for repairs and recovery. Earthquake insurance helps pay for destruction to your home and belongings if an earthquake hits. It can help with emergency repairs and long-term recovery needs, such as compliance with updated building codes.
A typical earthquake insurance policy has a few main parts:[3]
Dwelling coverage
Dwelling insurance covers earthquake damage to your house, like cracks in the walls or a wrecked roof. It also includes an attached garage if you have one.
Other structures coverage
If you have unattached structures, such as a fence, shed, or detached garage, the other structures part of your policy covers it.
Personal property coverage
Personal property coverage helps pay to repair or replace your personal belongings, such as furniture, electronics, clothing, and appliances.
Loss of use coverage
If it’s not possible to live in your home after the quake, loss of use coverage helps pay for extra expenses you might have, like temporary housing, meals, and laundry.
Loss assessment coverage
This coverage is specific to condo owners or houses that are part of a homeowners association (HOA) and helps pay for your portion of fees to repair common areas.
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What earthquake insurance doesn’t cover
Earthquake insurance is often worth it for the protection it provides. But it doesn’t cover everything. Read your policy carefully — the specifics of what it covers (and what it doesn’t) can vary significantly. Understanding the protections you have in place can help you maximize your benefits if you need to file a claim.
Here are some items and situations earthquake policies typically exclude:
Fire: Even if an earthquake causes it, fire damage usually falls under your standard homeowners insurance policy (not earthquake insurance).
Vehicle damage: Policies don’t cover earthquake damage to vehicles. Instead, comprehensive coverage on your auto insurance policy can cover this.
Floods: Earthquake coverage doesn’t cover flood damage. You’d need a separate flood insurance policy for this protection.
Sinkholes: Some states require insurers to offer sinkhole coverage, so check your policy. Otherwise, adding it to your home insurance policy might be an option.
Masonry veneer: Earthquake insurance may not cover brick, rock, or stone veneer unless you purchase additional coverage.
Who needs earthquake insurance
If you own a home, consider the risk of earthquakes in your area. The U.S. Geological Survey provides detailed maps showing the levels of seismic hazards across the country.
The red and orange areas on the map below show that the West Coast has the highest risk, including California, Oregon, Washington, and parts of southwest Arizona.
Other areas with a high chance of seismic damage include south and central Alaska, west and central Wyoming (especially near the tri-state corner of the state), Idaho, and Montana. The Kentucky Bend, including the surrounding states of Tennessee and Missouri, is also an earthquake-prone area.
Living in a high-risk area is a strong reason to consider purchasing earthquake insurance — especially if you can’t afford to cover the cost of repairs or rebuilding after a quake. Without coverage, you may be on the hook for paying a mortgage on a damaged home while covering temporary living expenses.
California, in particular, has a cause for concern. The state is a seismic hot spot, with 90% of the country’s quakes happening there. The California Earthquake Authority reports most residents live within 30 miles of an active fault. Yet only 10% of Californians have earthquake insurance, according to the Federal Emergency Management Agency (FEMA).[4]
How much earthquake insurance costs
How much you pay for earthquake insurance depends on where you live (your risk of an earthquake) and your home type. The average cost of an earthquake policy is $800 per year. Insurance companies calculate premiums on a “per-$1,000 basis.” That means your cost is a specific amount per $1,000 of coverage you purchase.[5]
For Example
Suppose you own a wood frame house in Washington state with a replacement cost of $600,000. If a company quotes you a price of $2 per $1,000 of coverage, your annual premium would be $1,200. But if you lived in Virginia, your quote might be less than 50 cents per $1,000, or around $300, for the same house.
Older homes generally have more expensive premiums. Brick houses can also cost more to insure — between $3 and $15 per $1,000 in areas with a high earthquake risk. This is because they don’t handle quake stress as well as wood frame houses do.
Earthquake insurance deductibles
Premiums aren’t the only cost of earthquake insurance — deductibles also come into play. While typical homeowners insurance companies set deductibles as a fixed dollar amount, earthquake insurance deductibles are usually a percentage. It can range from 2%–20% of your home’s replacement value, according to the Insurance Information Institute (Triple-I).
Choosing a higher deductible can help lower your earthquake insurance cost, but you’ll need to cough up more money if you file a claim. The smart thing to do is find a balance between affordable premiums and a deductible you can afford if an earthquake damages your home.
Where to buy earthquake insurance
On average, only 23% of homeowners have earthquake insurance. Coverage varies by region, with homeowners in the western and southern parts of the U.S. choosing coverage more often than homeowners in the Midwest. But these percentages are likely much lower than the number of people who could benefit from earthquake insurance, especially in high-risk regions.
You have several options when it comes to purchasing quake insurance. Your insurer may let you add quake protection as an endorsement to existing coverage, but it’s also available as a stand-alone earthquake insurance policy. Several well-known companies offer earthquake coverage, including Allstate, Amica Mutual, GEICO, Liberty Mutual, and State Farm.[6]
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How to save on earthquake insurance
It’s possible to lower your earthquake insurance costs without sacrificing essential coverage. Here are a few strategies to help you get a great deal:
Get quotes from multiple companies. Premiums can vary widely between insurers. Shopping around is the best way to find the most cost-effective option for your needs and budget.
Add earthquake coverage to your existing policy. An endorsement from the same company that provides your home insurance policy can often save you money compared to buying a separate earthquake insurance policy.
Make your home more earthquake-resistant. Insurers can offer discounts for upgrades like bolting the foundation, reinforcing walls, and securing water heaters.
Keep your credit score up. Many states allow insurers to use your credit history as a factor in calculating premiums. Maintaining good credit can help lower your rate.
Review your coverage regularly. Your home’s value and risk level can change over time. Look over your policy once per year to make sure you have the right amount of coverage and aren’t paying for more than you need.
Earthquake insurance FAQs
If you’re considering earthquake insurance, you’ll likely have questions about how it works and what to expect. Here’s some additional information about seismic coverage.
What happens if you don’t have earthquake insurance?
Without earthquake insurance, you’ll be responsible for paying all repair and rebuilding costs out of your own pocket if an earthquake causes severe damage to your property. Standard homeowners insurance doesn’t cover earthquakes, and you could face significant financial hurdles without earthquake insurance.
What is a good deductible for earthquake insurance?
Earthquake insurance deductibles typically range from 2%–20% of your home’s replacement value. A “good” deductible depends on your budget and risk tolerance. A higher deductible means lower premiums, but you’ll shell out more funds if you file a claim.
What percentage of people have earthquake insurance?
The number of people with earthquake insurance varies by region. Triple-I reports that 28% of homeowners have coverage in the West, 25% in the South, 21% in the Northeast, and 16% in the Midwest. But in California, where 90% of the country’s earthquakes happen, only 10% of residents have this essential coverage.
How much earthquake insurance should you buy?
How much earthquake insurance you should buy depends on your home’s value, its reconstruction costs, and your personal financial situation. Generally, you’ll want enough dwelling coverage to cover the cost of rebuilding your home. You should also purchase personal property and loss of use coverage for more peace of mind.
How much is earthquake insurance in California?
Earthquake insurance costs California homeowners an average of $800–$5,000 per year. The high premiums are due to the state being prone to seismic activity. How much you pay can vary widely depending on your home’s location, its construction type, and the deductible you choose.
Amy is a personal finance and technology writer. With a background in the legal field and a bachelor's degree from Ferris State University, she has a talent for transforming complex topics into content that’s easy to understand. Connect with Amy on LinkedIn.
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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