Consider Buying Earthquake Insurance
Images of desperation and despair continue to pour out of Haiti in the wake of its devastating earthquake last month, killing more than 200,000 people and directly impacting more than 3 million of its people. This earthquake also serves to remind Americans of their exposure to this peril. Records dating back to 1900 reveal that earthquakes have occurred in all 50 states and have caused damage in 39 of these states. The Federal Emergency Management Agency (FEMA) released a major study in 2000 indicating that U.S. earthquake losses over time could average $4.4 billion a year.
So the following question naturally arises: what is your exposure to an earthquake? Research indicates that residents in California, Oregon, and Washington are most at-risk. However, parts of Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri, and Tennessee are also quite exposed to earthquakes. The New Madrid Seismic Zone runs under these states and, though it occurred long ago, gave rise to one of the largest magnitude earthquakes to ever hit the United States.
If you live in any of these states, you should ascertain your proximity to an earthquake fault zone. California residents can determine their exposure by visiting the State of California’s Department of Conservation Web site, which provides a list of affected cities and counties. For other state-specific information, visit the U.S. Geological Survey Web site.
Most homeowners policies specifically exclude earthquake losses, just as they do flood losses. Therefore, if you live near an earthquake seismic zone, consider purchasing a separate earthquake policy or an earthquake endorsement attached to your homeowners policy. In addition, the following are some steps to take that will reduce your chances of injury or property damage resulting from an earthquake.
- Verify that operational fire extinguishers are strategically located on each floor of your home.
- Anchor tall furniture, refrigerators, water heaters, and bookcases securely to the walls.
- Utilize flexible connectors for gas supply to gas-fueled appliances.
- Keep beds away from glass or any hanging object that might fall.
- Verify that your home’s roof and chimney are well-maintained, with proper support.
- Apply safety film to windows and glass doors.
- Add anchor bolts or steel plates between the home and its foundation.
- For older homes, work with a civil engineer or city building department to verify that your home is up to code for the earthquake peril.
- Communicate to family members an emergency meeting place should your family get separated during an earthquake.
If you are in your home when an earthquake occurs, stay inside and move away from windows, skylights, doors, and objects that might fall. Crawl under a sturdy item such as a large table or desk. Stay where you are until the shaking stops.
Copyright 2010
International Risk Management Institute, Inc.
Information relative to AAA Hoosier Insurance offerings can be obtained through the club’s Web site http://www.AAA.com or by calling 317-923-1500.
February 15th, 2010 at 9:42 am
Insurance agents are often asked by insureds whether they should purchase earthquake insurance or not. That’s a tough question to answer in central Indiana. We have not had significant earthquake activity in Indiana for many, many years. Most homeowners do not even think about earthquake as a risk. The best answer I can give was actually given to me by an insured when I first started my insurance career. I was asked about the cost of earthquake insurance by a new client. I didn’t want to answer becuase I was afraid I would lose the sale, but I gave the insured the amount (about $240 per year). She thought about it for a minute and then said,”well $20 per month is certainly not too much to spend to cover the biggest investment I will probably every have.” She took the coverage and I have given her advice to many insureds over the past 30 years.
February 19th, 2010 at 7:32 am
We purchased earthquake insurance many years ago when we had a small earthquake hear in central Indiana. It makes you feel secure and is very inexpensive.