When The Earth Moves, Will Your Homeowners' Insurance Cover You?

By
Real Estate Agent with Evers & Company Real Estate, Inc. AB95346

Yesterday, just before 2:00pm, I was startled by what sounded like my washing machine going totally haywire.  Oh, and I wasn't even doing a load of laundry at the time! 

The house was shaking like crazy, and the charger for my camera battery danced to the edge of my dresser and jumped down to the floor.  What was happening here?

After about 30 seconds, all was calm, and there didn't seem to be any damage.  But what just happened? I called my neighbor who had her TV set turned on.  And I gotta say, earthquake just had not occurred to me.

As the dust settled, I started to read through all of the messages from colleagues on our company list serve.  And one of them caught my attention.  We had a small quake last year that was barely felt in DC.  In his message, my co-worker said that soon afterwords, he got earthquake insurance added to his homeowner policy, and that his wife laughed her head off, saying that it was a total waste of money.

But was it?

To get more information on earthquake insurance, I called my State Farm Insurance office.  They are getting a ton of calls about quake damage to some of the homes they insure, and without a special endorsement, similar to what you get for flood insurance, earthquake damage is not covered by the normal policy. 

Right now, of course, there is a moratorium on new applications.  But after the earth settles down, they will reopen sales of this coverage.

How much does it cost?  She estimated that for my house, which is covered for something around $700,000, it would cost an additional $350 to $500 per year. 

This time I was lucky.  There does not appear to be any damage at all.  But this quake was a bit unsettling, and I'm starting to wonder if, once the moratorium is over, will it be worth it to increase my current premium by about 40 percent. 

What a crap shoot!

If you are planning a move to or from the Washington, DC area, I can help.  Call, email or text me at:
Housepat@mac.com
202-549-5167
Licensed in DC, Virginia and Maryland

 

 

 

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Re-Bloggged 6 times:

Re-Blogged By Re-Blogged At
  1. Chris Ann Cleland 08/24/2011 12:47 PM
  2. Susan Morrison 08/24/2011 05:12 PM
  3. Cheryl Ritchie 08/24/2011 06:38 PM
  4. Yvette Chisholm 08/24/2011 11:42 PM
  5. Ritu Desai 08/25/2011 08:07 AM
  6. Jim McCormack 08/25/2011 10:34 AM
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Topic:
ActiveRain Community
Location:
District of Columbia District of Columbia County Washington
Groups:
HyperLocal Neighborhood and Community Posts
Posts to Localism
Tags:
earthquake insurance

Comments 61 New Comment

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Rainmaker
572,294
DeeDee Riley
Realtor - El Dorado Hills & the Surrounding Areas
Lyon Real Estate - El Dorado Hills CA

Pat, Earthquakes can wreak a lot of havic in areas prone to them so for piece of mind$350-500 isn't bad.

August 25, 2011 11:43 PM
Rainer
118,536
Monique Ting
S, e-PRO, SFR
INET Realty Honolulu, HI

Now you guys in the East will have to pay special attention to small details such as cracks in tiles and brick walls.

My house still has the marks of the 6.3 earthquake we experienced in Hawaii 5 years ago & the previous owner didn't bother fix them up...

As for the insurance, it's a matter of personal choice. Here house a worth less than the land they are built on, so many people with older homes do not have the earthquake coverage on their homeowner's insurance!

August 26, 2011 03:26 AM
Rainmaker
1,757,674
Roy Kelley
Retired Real Estate Broker, Maryland Blogger

Good post. Every home owner without earthquake coverage should now rethink their risks.

 Life is good in Maryland!

August 26, 2011 06:31 AM
Rainer
24,923
Dave Bittner
Summit County, Colorado
Paradise Realty

What?  You think your insurance should cover things that can destroy your home?   Like floods and earthquakes?   What are you thinking?

August 26, 2011 10:39 AM
Rainmaker
1,162,109
Gene Riemenschneider
Turning Houses into Homes
Home Point Real Estate

In most places EQ coverage is a percentage of the policy, not a flat fee.   I have been out of insurance for some time, but it used to be like 10% and that may be a California thing.

Now after an Earthquake everyone and their mother used to call up and blame every problem on the property on the Earthquake - no matter how old or what the real issue was.  So we would go out, document the "damage", get sworn statements and such.  Then rather deny the claim (as would be appropriate but legally riskier) we would just thank them and point out it is under the deductible.  Now we have the damage documented in the file with them swearing the EQ caused it.  No chance of blaming it on the next wind storm or what ever.

August 26, 2011 03:44 PM
Anonymous
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2,267,572

Patricia Kennedy

For Your Home in the Capital
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Additional Information

Pat Kennedy -- author of The Irreverent Guide to Real Estate -- gives you a look at life on the streets as a real estate broker in our nation's capital. And her blog is peppered with great advice combined with humor!