With the recent quakes in California, earthquake insurance may be at the forefront at many folks’ minds. We’ve put together a quick primer on what this coverage is and what it does, and doesn’t, cover.

Earthquakes can cause great harm to home structures. They can damage housing foundations and collapse walls; even relatively mild tremors can destroy furnishings and belongings.

Homeowners and renters insurance do not cover earthquake damage; a standard policy will, however, generally cover losses from fire following a quake and, if such a fire makes your home unlivable, cover the additional living expenses incurred while you live elsewhere during repairs.

Cars and other vehicles are covered for earthquake damage under the optional comprehensive part of an auto insurance policy.

Earthquake coverage is available in the form of a separate policy or an endorsement from most private insurers and, in California, from the California Earthquake Authority (CEA).

How it works

  • It’s usually sold with deductibles equaling 10 to 25 percent of the structure’s policy limit.
  • It only pays for damages that exceed the deductible.
  • There may be a separate deductible for contents, structure and unattached structures like garages, sheds, driveways, or retaining walls.
  • Generally, this coverage isn’t available to buy for a period of time after an earthquake.

What it covers

  • Repairs to your home
  • Your personal property due to earthquake damage
  • The cost to remove debris
  • Extra living expense you might have while your home is repaired or rebuilt

What it might cover

  • Increased costs to meet current building codes and costs to stabilize the land under your home
  • Other structures not attached to your house

What it doesn’t cover

  • Fire
  • Land
  • Vehicles
  • Preexisting damage
  • External water damage
  • Damage due to:
    • Landslides
    • Settlements
    • Mudflows
    • Earth rising, sinking, and contracting

What it might not cover

  • Floods
  • Tidal waves or tsunamis – even when caused by an earthquake

To see if you’re covered or not for these types of damages listed above, talk to your agent or broker and be sure to read your policy.

Sources: excerpted from the Insurance Information Institute and the WAOIC