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Are You Prepared For An Earthquake? |
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Home > Mortgage Research > Are You Prepared For An Earthquake? | |
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Mortgage Research
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When you apply for a home loan, lenders require hazard insurance, but not earthquake insurance. We didn't think earthquake insurance was a worthwhile investment until we saw up close the damage from the Northridge earthquake. Several of our clients lost their home or had damage. Even after you pay twenty years of earthquake premiums the damage caused by just a few seconds can be recovered financially by a good insurance policy. We recommend earthquake coverage for our clients in California... The following information is from the California Earthquake Authority and may help you decide if earthquake insurance is right for you.
Are you prepared? Well, are you? Oh sure, you’ve heard it before, but have you really done anything about it? Although in California there’s a constant risk of a major earthquake happening at any time, California often goes for long periods of time without experiencing a major earthquake, so we tend to put them out of mind, and put off taking steps to protect ourselves, our family, and our home from the devastating damage an earthquake can cause. But when a quake hits and damages our home and disrupts our lives, we remember the “be prepared” message, and regret not having done what we could to protect ourselves and limit the damage.
It is possible that even if you take steps to protect your property, an earthquake could still destroy your home or cause a level of damage that will require major repair, and you will need to repair or replace belongings. One option for managing these potential costs is to buy earthquake insurance, which can help you recover from devastating damage.
The majority of residential earthquake insurance policies sold in California are issued by the California Earthquake Authority (CEA), a privately-funded, publicly-managed instrumentality of the State of California. CEA insurance policies are designed to repair or rebuild your home if it suffers significant damage from an earthquake. You may purchase a CEA policy only through the CEA’s 18 participating insurers, and only if you have purchased a residential property fire insurance policy (such as a homeowners, condominium, or renters policy) issued by one of those participating insurers. A complete list of companies that sell CEA insurance.
It is up to each homeowner to consider their individual risk factors and then weigh the cost of earthquake coverage against the benefits that coverage may offer after a devastating earthquake. There are a number of sources of information, including government and private Web sites, where you can learn more about earthquake risks.
Source: California Earthquake Authority |
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