Earthquakes can leave significant damage in their wake. They can cause the collapse of a building’s walls and foundations, among other things. If you work in an area where this type of disaster occurs frequently, it is highly recommended that you purchase earthquake insurance.
Most standard insurance policies do not include earthquake coverage, however. Therefore, you may need to acquire this coverage as an add-on to your insurance policy for an extra cost.
Who Needs Earthquake Insurance?
Earthquake insurance is not legally required. Nevertheless, you should strongly consider obtaining this coverage if you work within an area with frequent seismic activity. The U.S. Geological Survey monitors each state’s tremor timeline and can thus give you a good idea of your area’s risk of earthquakes.
Commercial properties in states like California, Oregon, Washington, and Hawaii are especially prone to sustaining earthquake-related damages. This type of event is also becoming increasingly common in Oklahoma and Texas, where fracking occurs frequently.
Earthquake Insurance Coverages
A typical earthquake insurance policy includes the following three coverages:
- Repairs to your building and any attached structures
- Personal property such as hardware, appliances and furniture
- Additional new office expenses, also known as “loss-of-use” coverage
This type of policy does not cover damages due to fires, floods, or damage to vehicles or masonry. Building code upgrades and land repair that are necessary to stabilize your commercial building are generally available as additional coverages.
How Much Coverage Do You Need?
If you’re a commercial property owner, your insurer will typically establish the same limits on building coverage for both your habitational and earthquake insurance policies. Earthquake insurance policies often have high deductibles because of the types of damages they cover.
Factors Affecting Earthquake Insurance Rates
The cost of an earthquake policy normally depends on multiple factors, including:
- Your ZIP code
- Your building’s age
- The number of floors in your building
- The building materials utilized for your building
- The cost to rebuild your building
- The type of soil on your property
- Your building’s proximity to fault lines
The difference between two rates for two distinct commercial buildings in the same area can sometimes be enormous because of at least one of these factors.
Speak To The Professional Commercial Insurance Brokerage
Reach out to the commercial insurance brokers at CI Solutions to learn more about earthquake insurance and its benefits. Our team will work closely with you to understand and meet your specific coverage needs.
We are an independent commercial insurance brokerage that is dedicated to building strong partnerships with our clients, regardless of their needs and budget. Call CI Solutions today at 703.988.3665 or contact us online for more information about our commercial insurance policies.