Earthquake Insurance, Explained

Homeowners, condo, and renters policies commonly exclude damage caused by earthquake shaking. Separate earthquake coverage may be available through the California Earthquake Authority (CEA) or another insurer. Fire following an earthquake may be handled differently from shaking damage, so read the actual residential and earthquake forms together. CDI's residential guide explains the separation.

CEA coverage is purchased through a participating residential insurer; the underlying residential policy and CEA policy must be with a CEA participating company. Current homeowner options include 5%, 10%, 15%, 20%, and 25% dwelling deductibles, subject to eligibility restrictions. For example, a 15% deductible on an $800,000 dwelling limit is $120,000; a covered $200,000 dwelling loss would be reduced by that deductible, subject to all policy terms.

Premium depends on the property, construction, coverage, and deductible. Use CEA's coverage-and-deductible table and calculator rather than a statewide or neighborhood average. Eligible retrofitted older houses may receive a CEA discount of up to 25%; documentation requirements apply.

Ask three practical questions:

• Financial exposure: how much dwelling, personal-property, or assessment loss could you absorb?
• Deductible: what covered damage would have to occur before a payment could begin, and could you fund that amount?
• Recovery: what temporary-housing, repair, and document needs would follow a serious event?

The state does not generally mandate residential earthquake insurance. A lender, association, or contract may impose its own requirements, so verify rather than assuming. Compare the deductible and limits with savings and other recovery resources; no single answer fits every household.

CEA's current homeowner table identifies several distinct features:

• Building code upgrade: $10,000 is included, with higher choices available, but payment is available only after the dwelling deductible is met and covered work is undertaken.
• Loss of use: selected limits may cover additional living expenses after a covered event and carry no deductible.
• Emergency repairs: coverage is limited; the first $1,500 is not subject to the deductible.
• Personal property: availability and deductible treatment differ between Standard Homeowners and Homeowners Choice.

Check the declarations and current CEA table; limits, exclusions, and conditions apply.

CEA lists 5%, 10%, 15%, 20%, and 25% homeowner dwelling deductibles. Homes with a Coverage A limit above $1,000,000, and pre-1980 dwellings on a raised or other foundation without a verified retrofit, are currently limited to 15%, 20%, or 25%.

A qualifying documented retrofit may change deductible eligibility and may earn a discount. Before applying, gather the construction year, foundation type, dwelling limit, retrofit plans, permits, invoices, and required verification. Do not describe work as a qualifying retrofit until the applicable documentation standard is met.

Earthquake products differ by occupancy:

• Renters: compare personal-property and loss-of-use choices in our renters earthquake guide.
• Condo owners: compare interior or building-property coverage, loss of use, and loss assessment with the association's master policy, deductible, governing documents, and any earthquake exclusion.
• Mobilehome owners: use the applicable mobilehome form and foundation information.

A loss-assessment endorsement responds only to assessments and causes of loss that meet its terms. Obtain the HOA master declarations and relevant endorsements before selecting a unit-owner limit.

General information, not legal advice or an offer of coverage. Policy forms, declarations, eligibility, and current program rules control. Confirm choices with the residential and earthquake insurers.