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Earthquake Damage Claims

Earthquakes happen almost every day in California and most are small enough that they are never felt and don’t do any damage. A bigger quake, however, can result in massive damage to personal property, injuries, and even death. Despite this ongoing risk, only about one out of every ten California homeowners has earthquake damage insurance. Even when you have insurance, you face an uphill battle in getting paid the full amount that you’re owed on an earthquake insurance claim. This article will take a closer look at what earthquake insurance covers, the steps to take after a quake happens, and how an earthquake claim attorney can help.

Earthquake Risks in California

It’s estimated that 70 percent of Californians live within 30 miles of a major fault in the earth. This increases the risk of a quake causing major damage. A quake can shift a home off its foundation, cause structural cracks, or even cause the entire building to collapse. Other risks from a major earthquake include:

  • Destruction of fences and landscaping
  • Cracks in walls or ceilings
  • Destruction of personal belongings
  • Weakened home foundation
  • Damage to vehicles
  • Personal injury

Homeowner Insurance vs. Earthquake Insurance

California law does not require homebuyers to carry a homeowners’ insurance policy. A mortgage lender often does require the owner to carry some sort of policy. However, homeowners’ insurance does not cover any costs for damages caused by an earthquake. A separate earthquake policy is required for that type of coverage. Because earthquake insurance is expensive, only about 10 percent of California homeowners have a policy.

Earthquake damage to automobiles is not covered unless you have a comprehensive auto insurance policy.

What’s Covered by Earthquake Insurance?

Earthquake insurance policies usually cover three main areas:

  • Damages to the home and attached structures, such as a garage
  • Personal belongings like furniture, clothing, electronics, etc.
  • Additional living expenses (ALE) if you are displaced from your home

Sometimes earthquakes can cause fires, flooding, landslides, or additional disasters. Any damages that result from these are usually not covered by earthquake insurance unless the homeowner has purchased them as an add-on.

Each section of earthquake coverage is subject to deductibles. The deductibles are generally within the range of 10 to 20 percent of coverage amounts, so they can be quite high. Understanding what is covered and what you owe on a policy like this is important, so it’s a good idea to discuss your policy with an earthquake claim attorney.

Commercial Building Earthquake Insurance

Commercial property insurance policies for businesses usually do not include earthquake coverage. To qualify for commercial quake insurance, you will likely need to have an inspection of your business property done. Commercial earthquake insurance will cover repairing or rebuilding the structure, as well as replacing business equipment that is damaged or destroyed in an earthquake. Depending on how much coverage a business has, the policy might also cover lost income, lost employee wages, and lease payments.

It’s important to note that there is usually a time limit imposed on coverage for business interruption costs. Repairs to a commercial property after an earthquake must be made before that time limit expires.

Steps to Take When Filing an Earthquake Insurance Claim

After an earthquake happens, follow these steps to properly file an earthquake insurance claim:

  1. Notify your insurance agent in writing that your home has sustained damage, even if you don’t have earthquake insurance. This can be important later on when dealing with the California Earthquake Authority, FEMA, or other agencies.
  2. Take photos of all damages to your home, attached structures, vehicles, landscaping, fences, or anything else that is affected.
  3. Keep receipts and record all expenses that result from being displaced from your home. This includes hotel costs, food, new clothing, or anything else you have to spend due to lost or damaged property.
  4. California state benefits for additional living expenses (ALE) kick in when you have spent just $1,500 out-of-pocket. California Earthquake Authority policies will generally cover up to $200,000 in ALE after an earthquake.
  5. Your insurance adjuster will try to rush you into a quick settlement. Do not provide a Proof of Loss form to the insurance company before consulting with a licensed earthquake claim attorney.

How an Earthquake Claim Attorney Can Help

Severe earthquakes are rare, so an inexperienced adjuster may not even know what damages to look for when assessing your home. An earthquake claim attorney can help you with this process by getting a second opinion from a structural engineer. The insurance company may want you to cut corners to reduce paying out the full amount that you are owed. An earthquake claim attorney will help you obtain the full amount to cover damages, based on an independent assessment of damages to your home — not the insurance company’s estimate. Your attorney will also ensure that all paperwork is filed on time and that all deadlines are met, so you won’t miss out on any payments you are owed.

We’ll Help File Your Earthquake Insurance Claim

Earthquake insurance claims are notoriously complex to deal with. By documenting the damages, tracking your expenses, getting an independent assessment, and working with an earthquake claim attorney from the Morgan Law Group, we’ll work with you to make sure you receive the insurance payout you are owed.