We live in California, should we buy earthquake insurance?
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Asked April 15, 2013
Earthquake insurance is not included in any standard home insurance policy. If you live in an area that is prone to movements of the earth, you will have to make the decision of whether or not to purchase the coverage separately. Since many parts of California are especially susceptible to earthquakes, having an earthquake rider on your homeowners policy is usually a good idea.
There is currently no way to predict when or if an earthquake will happen but there are ways to stay prepared. And while you could live in a fault zone for decades without ever feeling a single quake, it only takes one to demolish your home. If this happens and you do not have the proper coverage, rebuilding your home will be an out of pocket expense, but if you have earthquake insurance, your insurer will rebuild your home up to the value of the policy.
More likely than an earthquake occurring in Southern California, there is a greater possibility of flooding. As with an earthquake, flood insurance is not part of a standard home policy and must be purchased separately, often from a high risk insurer. As construction standards have gone up, the likelihood of your home being destroyed by an earthquake has gone down, but the danger of flooding during and after an earthquake is a constant risk. Even if you decide to go without earthquake insurance, be sure to pick up flood coverage, because flooding is one of the after-effects of most earthquakes, thanks to a natural process known as liquefaction.
Liquefaction is the process of earth settling as it is shaken. When this occurs, soil that has been solid and stable for many years can suddenly turn into quicksand, or worse, standing water. Even though liquefaction is caused by a shaking of the earth, it is not considered earthquake damage, and havi8ng earthquake insurance would not benefit you. In fact, this type of situation will usually require you to have both earthquake and flood insurance. The former is to repair the home if it doesn't become flooded or sunken, and the second is to repair or replace the home if the shaking of the earth causes water to pool and flood the area.
Answered April 15, 2013 by Anonymous