Earthquake Insurance: Do You Need It If You Don't Live in California?

The Surprise: Standard Homeowners Insurance Doesn't Cover Earthquakes

This catches most homeowners off guard. Your standard HO-3 homeowners policy explicitly excludes earthquake damage — meaning if your foundation cracks, walls shift, or your chimney collapses in a quake, you're paying for repairs out of pocket. This applies regardless of where you live.

Flood insurance gets a lot of attention, but earthquake coverage flies under the radar in most states outside California. That's a problem, because seismic risk isn't limited to the West Coast.

Earthquake Risk Outside California

The New Madrid Seismic Zone

Running through Missouri, Arkansas, Tennessee, Kentucky, Illinois, and Mississippi, this fault system produced some of the strongest earthquakes in U.S. history (magnitude 7.5-7.9) in 1811-1812. Scientists estimate a 25-40% chance of a magnitude 6.0+ earthquake in this region within the next 50 years.

The Cascadia Subduction Zone

Oregon and Washington sit on a fault capable of producing magnitude 9.0+ earthquakes. The last major event was in 1700, and geologists say another is overdue.

Oklahoma and the Central U.S.

Induced seismicity from wastewater injection (related to oil and gas production) has made Oklahoma one of the most seismically active states in recent years. Between 2010 and 2020, Oklahoma experienced more magnitude 3.0+ earthquakes than California in some years.

Other At-Risk Areas

• South Carolina: Charleston experienced a devastating 7.3 magnitude quake in 1886
• Utah: The Wasatch Fault runs through Salt Lake City
• Nevada: Active faults throughout the state
• Alaska and Hawaii: Both highly seismically active

What Earthquake Insurance Covers

A standard earthquake policy covers:

• Dwelling: Structural damage to your home — foundation, walls, roof
• Personal property: Damaged or destroyed belongings
• Loss of use: Living expenses if your home is uninhabitable

Some policies also cover:

• Landscaping and exterior structures (with limits)
• Debris removal
• Building code upgrades required during repairs

How Deductibles Work (They're Different)

Earthquake insurance deductibles work differently from standard homeowners policies. Instead of a flat dollar amount, earthquake deductibles are a percentage of your home's insured value — typically 5-20%.

For a home insured at $400,000:

• 5% deductible = $20,000 out of pocket before coverage kicks in
• 10% deductible = $40,000 out of pocket
• 15% deductible = $60,000 out of pocket

This means earthquake insurance is really designed for catastrophic loss, not minor damage. A few hairline cracks in your drywall probably won't exceed your deductible. A shifted foundation or collapsed wall would.

How Much Does It Cost?

Cost varies dramatically based on location, construction type, and the age of your home:

• Low-risk areas (most of the East Coast, Midwest): $100-$300/year
• Moderate-risk areas (Pacific Northwest, Central U.S.): $300-$800/year
• High-risk areas (California, Alaska, parts of Utah): $800-$3,000+/year

Factors that affect your premium:

• Construction type: Wood-frame homes perform better in earthquakes and cost less to insure than brick or unreinforced masonry
• Age of home: Older homes without seismic retrofitting cost more
• Soil type: Homes on loose soil or fill are at higher risk of liquefaction
• Foundation type: Bolted foundations are more earthquake-resistant
• Distance from known faults: Closer = more expensive

Who Should Seriously Consider It?

Yes, Probably Worth It If:

• You live within 50 miles of a known active fault
• Your home is brick, stone, or unreinforced masonry
• Your home was built before modern seismic building codes
• You couldn't afford major structural repairs out of pocket
• Your mortgage is large relative to the home's value (you'd still owe on a damaged home)

Probably Not Necessary If:

• You're in a very low seismic risk area (parts of Florida, the upper Midwest)
• You could self-insure a major repair ($50,000+)
• Your home is newer construction with modern seismic design
• The premium is prohibitively expensive relative to the actual risk

How to Get Coverage

Standalone Earthquake Policy

Most commonly purchased as a separate policy from a specialty insurer. In California, the California Earthquake Authority (CEA) is the primary provider. Outside California, several private insurers offer standalone policies.

Endorsement to Your Homeowners Policy

Some insurers offer an earthquake endorsement (rider) that adds coverage to your existing policy. This is often the simplest option but may have more limited coverage.

What to Compare

• Deductible percentage (lower is better but costs more)
• Coverage limits for dwelling, personal property, and loss of use
• Whether the policy covers masonry veneer (brick exteriors)
• Whether building code upgrade coverage is included

What About Renters?

If you rent, your landlord's insurance doesn't cover your belongings in an earthquake, and your renters insurance likely doesn't either. Earthquake coverage for renters is available as a separate policy or endorsement, usually for $50-$150/year — worth considering if you have significant personal property in a seismically active area.

The Bottom Line

Earthquakes are a bigger risk outside California than most people realize, and the gap in standard homeowners coverage is real. If you're in a moderate-to-high risk area, get a quote — the cost might be lower than you expect, and the protection against catastrophic loss is significant. Even if you're in a "low-risk" area, it's worth understanding that your homeowners policy won't help if the ground shakes.