If you live near a fault line and you can afford to pay for it on top of your regular homeowners insurance costs, then earthquake insurance might be worth it.
Pat HowardPat HowardManaging Editor & Licensed Home Insurance ExpertPat Howard is a managing editor and licensed home insurance expert at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.&Kara McGinleyKara McGinleySenior Editor & Licensed Home Insurance ExpertKara McGinley is a former senior editor and licensed home insurance expert at Policygenius, where she specialized in homeowners and renters insurance. As a journalist and as an insurance expert, her work and insights have been featured in Forbes Advisor, Kiplinger, Lifehacker, MSN, WRAL.com, and elsewhere.
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A basic homeowners insurance policy does not cover damage caused by earthquakes, though it will cover fire damage that occurs as a result of one. Otherwise, to actually cover your home and belongings from the direct effects of a quake, you’ll need a separate earthquake insurance policy.
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 the event of an earthquake.
Earthquake insurance costs thousands of dollars a year — and this is on top of your standard home insurance policy.
Earthquake insurance is more expensive in areas located near fault lines that are at higher risk for quakes.
The high policy cost and high deductibles mean many homeowners go without earthquake insurance.
If you live in an earthquake-prone area and you’re on the fence about earthquake insurance, you’ll need to weigh whether the risk of losing your home and not having coverage is worth the cost of the policy itself.
Not all earthquakes cause catastrophic damage. In fact, of the 10,000 earthquakes that occur in southern California each year, most are so small that they’re not even felt. 
Add to this the high premiums that come with earthquake insurance in high-risk zones near fault lines, and you’re probably thinking about skipping out on coverage. However, like anything else, all it takes is one large earthquake to cause extensive structural damage to your home and surrounding areas.
Here are a few pros and cons to help you decide if earthquake insurance is worth it for you.
Pros of earthquake insurance
Covers the cost to rebuild your home and replace your belongings if they’re destroyed by an earthquake
Covers the cost of hotel stays, restaurant meals, pet boarding, and other living expenses if you need to temporarily live elsewhere while your home is being rebuilt after a quake
Cons of earthquake insurance
Expensive rates — every $100,000 of earthquake coverage will cost you $500 to $1,000 in annual premiums
High deductibles between 5% and 25% of both your dwelling coverage and personal property coverage
You may be able to add earthquake coverage to your existing homeowners policy
Check with your insurance company to see if you can add an earthquake endorsement to your existing policy for a small fee. While this type of earthquake coverage is typically less comprehensive than a standalone earthquake policy, it’s also cheaper.
Do I need earthquake insurance?
If you're on the fence about whether earthquake insurance makes sense for you, start by taking a look at your home's earthquake risk. You can get an idea of how close you live to a fault line by looking at the National Seismic Hazard Map.
You might live closer to a fault line than you originally thought. From there, you can weigh the risks against the premiums to decide if earthquake insurance makes sense for your home and finances.
The United States Geological Survey (USGS) includes a list of factors that you should consider when evaluating your earthquake insurance needs, including: 
Your home’s proximity to an active fault
Frequency of earthquakes in your region
How long it’s been since the last earthquake
Your home’s construction type — if it’s a stone or brick home, it has a higher probability of being damaged by an earthquake
The soil condition and slope of the land
Whether or not your home is built specifically to withstand earthquakes
The cost of earthquake insurance and policy factors — like the deductible amount
Have a mortgage? Consider the amount of equity you have in your home
If your mortgage is mostly paid off and the bank no longer owns much of your home, you may be more inclined to purchase earthquake insurance. The more equity you have in your home, the greater incentive you have to make sure it’s covered for a rebuild after a quake.
On the other hand, if the bank owns most of the home and you’re comfortable walking away from your damaged home after an earthquake, then it might not make sense to purchase earthquake insurance.
In California, every $100,000 of earthquake coverage will cost you $500 to $1,000 in annual premiums.
Here’s an example.
Say you own a home that would cost $400,000 to rebuild at today's construction and labor prices. That means you're looking at earthquake insurance costing you anywhere from $2,000 to $4,000 per year.
Other factors that go into determining your rates include:
Your home’s age and location
Your home’s foundation — slab or raised
Your deductible — the higher your deductible, the lower your rates
The construction type of your home — frame or masonry
When we ran a sample quote for earthquake insurance through the California Department of Insurance, we found that masonry homes cost a staggering $2,000 more to insure annually than frame homes. 
Take advantage of earthquake insurance discounts and credits to lower rates
The California Earthquake Authority, for example, offers discounts of up to 20% for frame-constructed homes that were built before 1960 if they’re retrofitted with earthquake-proof structural features like foundation bolting and cripple wall bracing. If you own a newer home, your rates will already be lower since it’s likely built up to code.
How do earthquake insurance deductibles work?
When you file a claim for earthquake damage to your home, you’ll have to pay your policy deductible before your insurance will kick in to cover the rest. Earthquake policies generally use “percentage” deductibles, which means you’ll pay a percentage of your home’s coverage amount rather than a fixed dollar amount.
Most insurers give you the option of earthquake deductibles between 5% and 25%. If you file a claim for damage to your home’s structure and belongings, most insurers will make you pay separate deductibles for the dwelling and personal property portions of your policy.
Here’s an example of how earthquake deductibles work on a specific policy.
Personal property coverage
Amount you’re responsible for
Amount insurer is responsible for
In this example, the structure of the home is insured for $200,000 with a 15% deductible, and the personal belongings are insured for $100,000 with a 2% deductible.
If the home and belongings incurred $100,000 and $80,000 in earthquake damage, respectively, the policyholder would be responsible for paying $32,000 in deductibles before they’d be reimbursed the remaining $148,000 of the loss.
FEMA might be able to help you pay your earthquake deductible
If you can’t afford to pay your deductible and you live in a FEMA-designated disaster area, you may be able to get financial assistance from FEMA or the California Department of Insurance. Another option is to take out a low-interest loan with the Small Business Administration (SBA), which offers disaster loans to both homeowners and small business owners alike after a natural disaster.
What does earthquake insurance cover?
Earthquake insurance covers the cost of rebuilding your home or replacing your belongings after an earthquake or the aftershocks that follow. 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 policy consists of the following coverages:
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).
Where can I buy earthquake insurance?
Earthquake insurance is available through both major insurance providers and specialized earthquake insurers. Coverage can be purchased as an optional home insurance endorsement or as a separate earthquake insurance policy.
The Golden State accounts for around two-thirds of the country’s earthquake risk, and 61% of the country’s average annual earthquake losses occur in California. Suffice it to say, if there’s anywhere homeowners should carry earthquake insurance, it’s in California. If you live within 30 miles of an active fault (you can check for that here), you should consider insuring your home against earthquake damage. Earthquake insurance can be purchased through the California Earthquake Authority. If you’re looking to keep costs down, the CEA says it has flexible insurance offerings that can be tailored to meet your budget.
What happens if you don’t have earthquake insurance?
Homeowners insurance doesn’t cover “earth movement,” including damage directly caused by earthquakes. So if you don’t have earthquake coverage, then you’ll have to cover any earthquake damage out of pocket. If the quake is declared a “major disaster” by the federal government, affected residents may be eligible for a limited amount of public assistance funds.
How much does it cost to repair earthquake damage to your house?
The average cost of home repairs after an earthquake is anywhere from $4,000 to $30,000, according to Home Advisor.
Do I need earthquake insurance if I live on the East Coast?
Even though earthquakes are much more common on the West Coast than the East Coast, they still happen. The one plus side is that since earthquakes are much more uncommon in these areas, it's typically cheaper.
Homeowners on the East Coast can likely purchase earthquake insurance for less than $0.50 per $1,000 of coverage, according to the Insurance Information Institute. This means earthquake insurance on a $500,000 house would cost around $250 per year.
Does renters insurance cover earthquakes?
Most standard renters insurance policies do not cover damage caused by earthquakes. However, you may be able to purchase an earthquake endorsement to add to your renters insurance policy or else buy an entirely separate earthquake insurance policy to ensure you're fully covered.
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.
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Pat Howard is a managing editor and licensed home insurance expert at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.
Kara McGinley is a former senior editor and licensed home insurance expert at Policygenius, where she specialized in homeowners and renters insurance. As a journalist and as an insurance expert, her work and insights have been featured in Forbes Advisor, Kiplinger, Lifehacker, MSN, WRAL.com, and elsewhere.