California Earthquake Insurance: Be Prepared

California earthquake insurance is designed to protect you by providing financial reimbursement in the event of loss or damage to your property. If you are looking to take out home insurance it’s important to ensure you are perfectly clear on what any potential policy specifically covers.

Insurance policies can vary from one provider to the next so it’s vitally important to read the details of your policy. Yes, it’s a lot of paperwork, and it’s not particularly riveting reading, but thorough and careful preparation at this stage may help prevent problems in the future.

The factors you will need to compare between policies include:

- what is actually covered (home and/or contents)

- for what events does the policy apply (earthquake, fire, water damage)

- does the policy provide full replacement costs on home contents, or ‘actual cash value’, which is the depreciated value of your items?

In working out your costs, consider also the deductible: the amount you will need to pay out of pocket before an insurer will pay any expenses. Having a higher deductible can lower your premiums, but means you’ll pay more in the event of a claim.

Once you’ve chosen a California homeowners insurance policy, you will want to look into a policy to cover against earthquakes. As a California resident, you still have some more work to do to properly protect your assets – look once more at the events that are excluded.