Mike Causey | It’s Earthquake Awareness Month. Are you insured?

February is Earthquake Awareness Month. While North Carolina isn’t like California, which is known for having earthquakes, they do occur here.

It’s a good time for me to remind you that standard homeowners’ insurance does not cover damage from earthquakes. If you want to make sure you’re covered for earthquake damage, you’ll need to contact your agent and add an earthquake endorsement to your homeowners’ insurance policy.

If you own a mobile home, you may be covered. Again, it’s important to check with your agent to understand what is covered and what isn’t covered.

Not all insurance companies offer the earthquake endorsement, so you should check with your agent to see if it is an option with your current carrier.

In 2020, a 5.1 magnitude earthquake, centered in Sparta, was felt across North Carolina. It was the strongest earthquake to hit North Carolina since 1916. Fortunately, there were no reports of fatalities although many homes and businesses were damaged. Unfortunately, many of the homes and businesses lacked earthquake insurance.

Last spring, two earthquakes hit Surry County. They were centered within a few miles of each other. One was a 2.3 magnitude. The second was a 1.5 magnitude.

For most of us, our home is our biggest investment. I urge you to protect your investment by making sure you have sufficient insurance coverage. Also, I recommend that you review your coverage with your insurance agent annually.

Earthquake insurance covers repairs needed because of earthquake damage to your dwelling and may cover other structures not attached to your house, such as a garage or a storage building. It also insures your personal property against damage from an earthquake.

In addition, earthquake insurance may cover the cost to remove debris and pay for extra living expenses you may have while your home is being rebuilt or repaired.

Earthquake insurance generally isn’t very expensive. But its deductibles work a little differently that we’re used to for homeowners’ insurance. For homeowners’ insurance, your deductible is usually a set amount, say $500, $1,000 or even more.

For earthquake insurance, your deductible is usually a percentage of your home’s value, say 5% or 10%, up to 25%. So, if your house is valued at $200,000 and you have a 5% deductible, you’d be responsible for the first $10,000 and your insurance company would be responsible for the remaining damage.

That may seem like a lot of money. But it’s a lot easier to come up with $10,000 than the entire $200,000.

Insurance is all about managing risks. You’d do well to discuss earthquake insurance with your agent the next time you review your policy.