Homeowners Insurance for Earthquakes and Floods

By Compuquotes Team on March 27th, 2008
Homeowners Insurance

As we've seen with recent major disasters, getting protection for your home from things like flood and earthquakes should be at the top of your insurance needs. You won't be able to get this kind of protection from your standard homeowners insurance policy, though.

Under all homeowners insurance policies, flood, overflow of streams, waves, and a wide variety of other water related damages are excluded from all coverage. Until around 1968 no flood insurance of any kind was generally available. That was the year the Federal Government finally stepped in.

The Federal Government formed the National Flood Insurance program to protect the general population against these kinds of disasters. This government subsidized program offers limited amounts of flood insurance in specific areas. Local communities apply for participation in the program. In order to be eligible the community must agree to certain requirements relating to the use of land to minimize the danger of future flooding.

Since 1973 owners of single family homes have been able to obtain up to $35,000 in flood insurance at rates of about 25 cents per $100 of insurance. These numbers may change in the future, so it's a good idea to double check them.

If you live in a flood prone area and the type of protection is not offered to you and your family, contact any local officials to bring pressure on them. This is a vital piece of protection. It is known that earthquakes occur most frequently and severely on the Pacific Coast. There are about eighteen states that are vulnerable to major earthquake destruction, including Alaska, California, New York, Maine, Mississippi, Montana, Missouri, New Hampshire, and Hawaii.

The Homeowners insurance policy specifically excludes coverage for earthquake, volcanic eruption, and a few other horrific catastrophes relating to mudslides, landslides, and mudflow.

Earthquake insurance can be purchased by separate endorsements to the homeowners insurance policy. Most people either aren't aware of this, or simply don't think it's really necessary. Earthquakes do commonly occur, and when they hit a well populated area, the devastation is tremendous.

In 1971 the San Fernando Valley caused over an estimated half billion dollars in damages. Only $50 million in claims were paid out by adjusters. If more people had protected their homes with earthquake insurance, less people would have been left without homes.

We all live on Earth, therefore we are all susceptible to earthquakes, among other natural disasters.

Earthquake protection comes with a different kind of deductible. The amount can vary so greatly that it is not usually stated in dollars, but in a percentage of the damages.

It's common for people to overlook earthquake insurance until a small earthquake hits nearby their property. It's a common theory that smaller quakes are warning of something bigger, and sometimes it rings true. Some insurance companies have been known to suspend the sale of earthquake insurance when this happens.

And don't forget about flood, as it can be a very real threat depending on where you live.

As with anything, get the homeowners insurance protection if there's any possibility of you needing it. When it comes to your own home, don't take the chance.

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