Whew! That earthquake was close! Avoid financial aftershock.
Discover how you can protect your home for as little as $5 a month.
Don’t forget to protect your business property too.
November 7, 2011
Like flood, earth movement is not covered by a standard homeowner or tenant insurance policy. You can, however, obtain insurance protection through the purchase of an earthquake add-on to your homeowner policy or commercial property policy.
Although an earthquake is the first thing that comes to mind when someone mentions earth movement, this very broad category also includes landslide, mudslide, mudflow, sinkhole or any other movement that involves the sinking, rising or shifting of earth.
Should you buy earthquake insurance?
Insurance Commissioner John Doak advises consumers to consider their own circumstances and needs when deciding if earthquake insurance is a good buy. There isn’t one answer for everyone, but for most people their home is their major asset. Protecting your home just makes good sense.
An earthquake endorsement generally excludes damages or losses from floods and tidal waves – even when caused or compounded by an earthquake. However, loss caused by landslide, settlement, mudflow and the rising, sinking and contracting of earth may be covered if the damage resulted from an earthquake.
In the continental United States, earthquakes occur most frequently west of the Rocky Mountains. While the United Statesexperiences only two percent of the world’s earthquakes, some 90 percent of its population lives in seismically active areas. Statistics show that since 1900, earthquakes have occurred in 39 states and caused damage in all 50 states.
The New Madrid Fault zone lies within the centralMississippivalley extending from northeasternArkansasthrough southeasternMissouri, westernTennessee,Kentuckyand southernIllinois. The last major earthquake had a magnitude of 8, but scientists warn that this was not a freak occurrence. Earthquakes in Central andEastern United Statesaffect much larger areas than earthquakes of similar magnitude in the West. For example, theSan Franciscoearthquake of 1906 was felt 350 miles away, whereas the New Madrid earthquake of December 1811 rang church bells inBoston,Massachusetts, 1,000 miles away.
You might be thinking “but Oklahomais not on a fault line.” Well, on Saturday, November 5, 2011 at 2:15 a.m. near Prague a quake registered 4.8. Later that day at 10:53 p.m. Sparks, OK, Lincoln County registered 5.6 on the Richter scale, the largest ever recorded in Oklahoma. It was felt as far away as Illinois, Kansas, Arkansas, Tennessee and Texas. Oklahoma Geological Survey seismologist Austin Holland said the fault has been active since February 10. Those near the fault line can experience between 10 and 30 quakes per month.
Earthquake insurance is catastrophe insurance. How much earthquake insurance coverage should I buy?
Remember you should buy enough to cover the costs of rebuilding your house and replacing broken possessions. The amount of insurance you buy should be based on replacement and reconstruction costs, not the market value of your property and possessions.
Earthquake insurance is normally sold with deductibles equaling 2 to 20 percent of the structure’s policy limit. This means that if it cost $100,000 to rebuild a home and there was 5 percent deductible, you would be responsible for the first $5,000 dollars. A brick (no veneer) home valued at $200,000 with a 2% deductible is only $66 per year through Travelers.
You may say the odds are so slim you don’t want this valuable protection, that’s OK. However, if you want to see what it costs to protect your home or business building fill out the short form below and one of our team members will contact you shortly. Or, call our office at 463-0808 and we can discuss the options available to you. Melissa can provide enough basic information on coverage and pricing for you to say whether or not you’ll want earthquake coverage.
As your insurance agency we want you to be informed about the dangers that face your home and family and what kinds of insurance are available to handle these risks. Earthquake insurance is a catastrophic but often overlooked piece in protecting your home.
Very truly yours,
Lance Singleton
Agency Manager
P.S. You can email your request for coverage to Melissa@obionline.com and she will provide options to you quickly!