Think Your Homeowners Policy Includes Earthquake Insurance?

The only thing more depressing than the evening news is the speculation this week that the Southland is well past due for the big one.

Did I say Big One?

I meant Biiiig One.

So what does this mean for you as a property owner?

First of all, check your Homeowners Insurance. A standard home insurance policy sold in California does not include Earthquake Insurance.

Translation: Unless you definitely know that you have Earthquake Insurance, you probably do not have it.

The screen shake is not from an earthquake, it’s from too much coffee this morning trying to hold the camera still

Much like going to McDonalds and ordering the Quarter Pounder Meal. You are given the option to upgrade or “Super Size”. Earthquake Insurance comes in all sizes and costs, you can order it from a 5% to a 15% deductible.

Notice on your Homeowners policy the amount of coverage you have on your dwelling also known as the structure or house. Say last year you purchased a new property for $700,000, your policy may indicate an amount for the dwelling of $375,000, The earthquake insurance will cover the dwelling but not the land. Therefore, if you have a 10% deductible, you would be responsible for the first $37,500 in earthquake-related damage. Ouch!

One other thing to note, our home values have been rising faster than the National Debt, so now may be a good time to review your coverage with your Insurance Agent, the bad news is that new Earthquake Policy may just have become more expensive.

Pasadena Homes

Approximately 30% of Pasadena homes were constructed prior to 1939, which probably means the frame was built right on top of the concrete foundation perimeter without any additional bracing. It wasn’t until after World War II, that building codes began to change and address the deficiency.

When the ground starts shaking, the possibility exists for the frame structure to become detached and fall away from the foundation. Realizing the risks involved the state of California has been proactive and sponsored a program to subsidize Pasadena homeowners to help pay for part or in some cases all of the costs involved in a retrofit.

Let’s just hope the seismologists and the geologists are as wrong as the meteorologists who predicted our El Nino.