Illinois Earthquake

By now I am sure that you have heard about the 3.8 earthquake that Northern Illinois experienced this morning. Strange, since the earthquakes are supposed to happen in Southern Illinois or better yet, California!

My question to you is...Are you covered on your homeowners (HO) insurance policy if you experience damage from an earthquake?

My guess to the answer is...Probably not. Very few people have bothered to add earthquake coverage to their homeowners coverage. Earthquakes are like flood--loss from either is not "automatically" covered on a homeowners policy. Coverage must be added, either by endorsing the HO policy as in the earthquake, or by having to write a new policy. (flood)

Earthquake coverage is very reasonable at this time. Typically coverage can be added for $200 or less and most homes would be less than $100, although the more quakes we feel and the closer they get to us, the cost will begin to rise. Deductibles are handled differently for earthquake...generally there is a 5% or 10% of the dwelling limit being the deductible instead of a straight dollar amount.

Be sure to check with your agent as to whether or not you are covered.

More information from IRMI... "Standard, unendorsed homeowners policies exclude earthquake losses, but coverage for this peril can typically be endorsed onto the policy. (Note that if explosion or fire ensues due to the earthquake, insurance does apply but only for the ensuing loss.) Coverage is typically limited, though, with high deductibles such as 5 to 25 percent of the dwelling limit and no loss of use coverage. (Note that coverage in California is available only under a stand-alone policy through the California Earthquake Authority.) Some insurers have even stopped writing coverage altogether. Allstate Insurance Company, for example, dropped earthquake coverage in 2006 in every state where allowed by law."