While they might not be as fear-provoking for homeowners as more “visible” natural disasters like wildfires or tornadoes, earthquakes have the potential to cause catastrophic damage to homes all over the U.S.  As many as half of Americans are exposed to a potentially dangerous quake, and that number is likely higher in earthquake-prone states like California, Nevada, and Oklahoma. 
Yet only about 10% of homes in California are equipped with earthquake insurance — this in spite of the fact that 70% of the state’s population resides within 30 miles of an active fault line.   Earthquakes rarely reach a high enough magnitude to cause property damage, but all it takes is a single large one to shake your home off of its foundation and destroy it.
With earthquake insurance, your home, personal belongings, and additional living expenses (if you can’t live in your home after a quake) are all covered in that scenario.
Standard homeowners insurance does not cover damage caused by earthquakes
To protect your home and belongings against earthquake damage, you’ll need earthquake insurance
Your home insurance company may give you the option of adding earthquake coverage to your policy for an additional cost. Otherwise, you’ll need separate earthquake insurance
There are several major earthquake insurance providers, including Allstate, Nationwide, Progressive and Safeco (offered via the California Earthquake Authority), as well as Palomar and GeoVera (not in partnership with CEA)
What is earthquake insurance?
Earthquake insurance helps cover the cost of repairing your home and replacing your belongings after a bad earthquake. If the earthquake causes severe damage to your home, your policy can also reimburse you for temporary living expenses (hotel stays, restaurant meals, etc) while your house is being repaired.
A basic homeowners insurance policy doesn’t cover damage caused by earthquakes, so if you live in a high-risk area that has a potential for dangerous seismic activity (you can check your earthquake risk on the U.S. Seismic Design Maps website), you should consider purchasing earthquake insurance.
Where can I buy earthquake insurance?
Some home insurance companies offer earthquake protection as an add-on to your policy — it basically extends your home insurance to cover earthquake damage for an additional policy fee. This coverage can also be purchased as a separate policy through a company that offers it. If you live in California, earthquake insurance is available via the California Earthquake Authority (CEA) — a privately funded, publicly managed organization that provides earthquake insurance to Golden State residents.
What does earthquake insurance cover?
Earthquake insurance pays out for damage caused by earthquakes. It may also cover damage from a volcanic eruption that is triggered by an earthquake. If your home is damaged by an earthquake and you don’t have this coverage, you’ll likely have to pay for repairs entirely out of your own pocket.
A standard earthquake insurance policy has three main sections of coverage: dwelling, which covers your home itself; personal property, which covers your “stuff” aka furniture, appliances, laptops; and it covers additional living expenses, like the cost of hotel stays or transportation costs while your home is being repaired after earthquake damage.
Earthquake insurance coverage
|Coverage||What does it cover?|
|Dwelling coverage||Repairs to house and attached structures, such as a garage or porch|
|Personal property coverage||Your personal belongings, including electronics, clothing, and TVs|
|Additional living expenses||If your home is uninhabitable after an earthquake, ALE covers the cost of things like temporary lodging and meals while you’re away|
|Building code upgrade (optional coverage)||If local building code requires new homes to be built with certain structural upgrades, this covers any additional rebuild or repair costs that are needed to meet those requirements|
|Emergency repairs (optional coverage)||Immediate repairs to stabilize your home or personal property in order to prevent further damage in the wake of an earthquake|
What doesn’t earthquake insurance cover?
Earthquake insurance really only covers damage from earthquakes or a volcanic eruption that is the direct result of an earthquake. Other types of disasters caused by earthquakes, like fires, floods, sinkholes, etc, are covered by home insurance and flood insurance.
Certain items or materials are also typically excluded from coverage, including expensive collectibles, brick or stone that is only used as home veneer, pools, fences, vehicles, and breakable items and fixtures (like chandeliers or china).
How much does earthquake insurance cost?
The cost of earthquake insurance can vary widely depending on where you live and how your home is built. A typical policy in California costs around $800 annually, but if you live within miles of an active fault line or in a lower risk state, you may only pay a few hundred dollars in annual premiums.  Conversely a masonry home (brick or stone) that’s most at risk of being destroyed by a quake could cost thousands of dollars a year to insure, especially if it’s located near an active fault.
Along with the amount of coverage in your policy and your policy deductible, the price of earthquake insurance will depend on the following factors:
Your home’s location: If your home is in an earthquake-prone area, your rates will be higher.
The age of your home: Older homes generally cost more to insure than properties with a more modern build.
Your home’s construction type: Your home’s size, number of stories, construction (frame or masonry), characteristics (like veneer), and foundation type (slab or basement) will all impact your policy cost.
Check out the CEA’s earthquake insurance cost calculator for an estimate of how much your house would cost to insure.
Do I need earthquake insurance?
If your home is at risk of earthquake damage, then it is likely worth it to purchase earthquake insurance to protect your home and financial livelihood. It isn’t required by law, so you don’t need to purchase it, but if your house is in a region or state with foreseeable risk of potentially damaging quakes, you should consider earthquake insurance.
The state of California accounts for around two-thirds of the country’s earthquake risk, but some of the most violent ground-shaking occurs in the central U.S.  In recent years, states like Texas and Oklahoma have experienced more frequent earthquakes due primarily to wastewater disposal and hydraulic fracturing (fracking).  If you live in these states or any area that experiences seismic activity and you’re on the fence about earthquake insurance, consider the following:
Would you be able to repair or rebuild your home after a severe earthquake?
Do you have the funds to replace all of your belongings if they’re destroyed in an earthquake?
Could you afford to live elsewhere for an extended period of time while your house is being rebuilt after an earthquake?
You’ll also want to determine the likelihood of your home sustaining earthquake damage. If you have a multi-story brick home with a basement, for example, and a 5.0 magnitude earthquake strikes your area, your home faces a far greater risk of severe damage than a frame home that is built on slab.
Earthquake insurance is generally more expensive for homes built with susceptible materials, but there are plenty of ways to get lower rates, including shopping around for a policy that fits your budget, upgrading your home with a seismic retrofit, and raising your policy deductible.
How do earthquake insurance deductibles work?
When you file an earthquake insurance claim for damage to your home or personal property, you’ll need to pay a policy deductible, which is the amount you’re responsible for paying on an earthquake claim. Earthquake insurance deductibles work differently than homeowners insurance deductibles, which are typically set at a fixed dollar amount like $1,000.
Most earthquake policies give you the option of setting your deductible at 5%, 10%, 15%, 20%, or 25% of the dwelling coverage limit, or the amount your house is insured for. That means if your home has a coverage limit of $300,000 and you have an earthquake deductible of 15%, you’d be responsible for $45,000 in earthquake damage to your home before your insurer would cover the remainder of the claim settlement. If your home sustains, say, $100,000 in damage, you’d get $55,000 from your insurer to cover repairs ($45,000 subtracted from $100,000).
You don’t pay your deductible in the same way you pay a utility bill. Your insurer simply subtracts it from your claim payout, and the amount you get back is the claim settlement minus your deductible. If the damage to your house is lower than your deductible, you won’t be able to use earthquake insurance for repairs.
Earthquake insurance also typically includes a separate, lower deductible for damage to your belongings, but doesn’t charge a deductible for additional living expense payouts.  If you live in an earthquake-prone area, your insurer may require your policy to have a higher deductible.
Frequently asked questions
Does homeowners insurance cover earthquakes?
Homeowners insurance does not cover any type of “earth movement”, including damage caused by earthquakes. To fill this gap in coverage, you’ll need to add earthquake coverage to your policy or purchase separate earthquake insurance from a company that offers it.
Is earthquake insurance worth it?
Earthquake insurance can be expensive, especially if you live in Southern California or another region with frequent seismic activity. But if you’re able to afford it, earthquake insurance is a small price to pay for the peace of mind of knowing you’re financially protected against earthquakes. There are several ways to lower your policy rates, including raising your deductible, inquiring about flexible policy options that only cover what you need covered, and retrofitting your house.
In which U.S. states are earthquakes most common?
Earthquakes are most common in Alaska, Arkansas, California, Hawaii, Idaho, Illinois, Kentucky, Missouri, Oklahoma, Oregon, South Carolina, Tennessee, Texas, and Washington.
Why are earthquake deductibles so high?
Earthquakes are powerful enough to level entire homes and buildings. This makes insuring them a considerably high-risk endeavor for insurance companies. To cover the potentially significant losses from a major quake, insurance companies need to charge higher deductibles.