5 Essential Insurance Coverages: Earthquake Coverage

What is Earthquake Coverage?

The Earthquake endorsement “buys back” coverage for earth movement — which is excluded from the standard homeowners policy. Earthquakes can cause extremely costly damages to your home from weakening the structural integrity to the outright destruction of your dwelling. A typical deductible would be 5%. That is, 5% of the dwelling coverage amount, not 5% of the damages.

Imagine This Scenario

Mr. Henderson owns a beautiful home in Avon, Connecticut. It is insured for $350,000. An earthquake occurs and does $50,000 of damage to the home. Considering the 5% Earthquake deductible ($17,500) on Mr. Henderson’s policy, the insured is paid $32,500. If Mr. Henderson did not have the Earthquake endorsement on his policy, his claim would have been entirely denied.

What it Costs

In general, risks with frame construction will be able to access this coverage at a lower rate, while risks with stonework construction can expect their rates to be on the higher side. 

• Connecticut: Depending on construction and policy type, between $0.25 and $1.45 per $1,000 of coverage. For $300,000 of coverage, this translates to $75 – $435 annually.
• Massachusetts: Depending on construction and policy type, between $0.23 and $1.46 per $1,000 of coverage. For $300,000 of coverage, this translates to $69 – $438 annually.

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Useful Tip

A major earthquake hit Boston in 1755. An article by Jeremy Miller in the Boston Globe suggests a similar quake is likely to happen here once every 500 to 900 years.

Do you have the right insurance coverage to get you through all of life’s ups and downs? At Bearingstar Insurance, we know that you’ve worked hard for all that you’ve accomplished, and are here to make sure it’s all protected. With offices throughout Massachusetts and Connecticut, it’s easy to find a local agent to help with your insurance needs!