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."

Flood insurance points

Welcome to my first attempt at a blog. My plan is to focus on current insurance topics that are relevant to our area of the country. I understand that you have many, many sources of information coming at you 24-7 and I will try to make sure that I don't just bombard you.

I would like to briefly mention flood insurance today. Even though, as we heard on Tuesday, we still have 6 more weeks of winter, flood insurance works differently than other types of insurance, and warrants a little PRE-need thought. With flood insurance, there is typically a 30 day waiting period before insurance can be put into effect. So even if you contact me today, it will be 30 days before the policy can be in force.

My point in all of this is that it appears that our recent trend for higher than normal precipitation will continue. It appears that this could be another year with a high potential for flooding. Please also remember that no matter WHERE you are, you are in a FLOOD ZONE. You may have very low potential for flooding, but you still are classified as being in a zone. Low potential means low cost for flood insurance. Some of these policies are literally in the $100 to $200 range for a year to cover your home and contents.

If you have any questions about flood insurance, take an minute and ask. I'll be happy to discuss flood questions, or any other questions that you might have.