Earlier we discussed some of the insurance coverages pertaining to wildfires, which we certainly see enough of here in the arid high-desert Southwest. However, we found out on Tuesday morning that there had been a magnitude 4.0 earthquake affecting the entire northeast quadrant of the state late Monday night September 12th – resulting in a “suspension of binding authority” on homeowners and renters insurance policies for at least a day as long as no aftershocks were experienced.
While a 4.0 magnitude (30,000/year = often felt, but minor damage) Richter scale earth movement may not provoke even a raised eyebrow in some of you considering events that happen elsewhere, there is still the real risk of structural damage and other kinds of “insurable losses,” as well as a possible wake up call that earthquakes can happen whereever you are – and that you should be considering insurance coverage for them!
While residents of California may be commonly aware that a homeowners policy does not cover any loss or damage due to earth movement (including earthquake), that’s likely because they are regularly presented with an option to buy additional earthquake coverage when they get homeowners insurance. If they have a loan on their house and are in any sort of earthquake-prone zone, then the lender would certainly require the insurance in order to close the loan.
Earthquake coverage, like flood insurance coverage, is something not included on a homeowners policy – you have to ask for it and/or buy it on a separate policy. The occurrence of a 4.0 earthquake in New Mexico this week has us all thinking of the possibilities and new realities of the potential for loss.
Some homeowners insurance policies for homes located outside of earthquake prone zones can allow you to consider “buying back” earth movement coverage for a few dollars a month. Other earth movement policies can be purchased separately.
While the chances may be low that this could affect you, this week’s occurrence right here at home should have you considering the risk of not insuring against future possibilities. For details on earth movement coverage available for you, please contact an agent