Elijah Grant
California is a state that sits on the border of two continental plates, making it susceptible to earthquakes. While renters are not required by law to have earthquake insurance, it is a good idea to consider it. Earthquakes can cause a lot of damage, and even if your landlord has earthquake insurance for the building, their policy won't cover your belongings inside your rental home. Basic renters' insurance also doesn't cover earthquake damage, so you will need to add earthquake coverage to your policy or purchase a separate earthquake insurance policy.
| Characteristics | Values |
|---|---|
| Do renters need earthquake insurance in California? | Earthquake insurance is not mandatory for renters in California. However, it is recommended for those living in high-risk areas or near fault lines. |
| What does earthquake insurance cover for renters? | Earthquake insurance can cover the cost of repairing or replacing damaged personal property, temporary accommodation expenses, restaurant and laundromat services, parking fees, pet boarding, and debris removal. |
| How much does earthquake insurance cost for renters in California? | The cost of earthquake insurance for renters in California can vary depending on factors such as location, coverages, and deductibles chosen. It can be as low as $35 per year for basic coverage, while higher levels of coverage will cost more. |
| How to get earthquake insurance for renters in California? | Renters can obtain earthquake insurance as an add-on to their existing renters insurance policy or as a separate stand-alone policy. It can be purchased through the California Earthquake Authority (CEA), the state's primary earthquake insurance provider, or from other companies like GeoVera or Arrowhead. |
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What You'll Learn
Renters insurance policies rarely cover earthquakes
In California, renters are not required to have earthquake insurance. However, it is a good idea to get one if you live in an earthquake-prone area. Basic renters' insurance policies rarely cover earthquakes, and even if your landlord has earthquake insurance, it will not cover your belongings.
Standard renters' insurance does not cover "earth movement", a term that includes earthquakes, landslides, and sinkholes. These events can cause significant damage, but without specific coverage, renters are responsible for covering the costs themselves. Basic renters' insurance typically covers personal belongings against theft, fire, and some weather-related events, but it does not cover items damaged by earth movements. For example, if your TV falls over during an earthquake, you will have to pay for a replacement unless you have earthquake insurance.
Earthquake insurance for renters is available through the California Earthquake Authority (CEA) and a few other companies. It can cost as little as $35 per year, depending on factors such as location and the chosen coverages and deductibles. Earthquake insurance covers the cost of repairing or replacing personal property and temporary accommodation if you need to move out while your home is being repaired or rebuilt.
You can get earthquake insurance either as an add-on to your renters' insurance policy or as a separate stand-alone policy. If you live in a low-risk area, you can probably add coverage to your renters' insurance. However, if you live in a high-risk area like California, you will likely need to purchase a separate policy.
In some cases, your renters' insurance may cover direct loss due to explosion, theft, or breaking glass caused by an earthquake, even without specific earthquake insurance. Additionally, California law states that renters' insurance must cover fire damage caused by or following an earthquake. It is important to carefully review your insurance policy and contact your insurance company to understand your coverage.
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Landlord insurance won't cover your belongings
If you are renting in California, you may be wondering if you need earthquake insurance. While it is not a legal requirement, it is worth considering, especially if you live near a fault line. Standard renters' insurance policies do not typically cover earthquake damage, and even if your landlord has insurance for the building, their policy will not cover your belongings.
If you are renting, your landlord's insurance will not cover your belongings. Landlord insurance covers the building itself and any damage to it, as well as liability claims, loss of rental income, legal expenses, and, in some cases, their own personal belongings. However, it does not cover the tenant's possessions. For example, if there is a fire or a windstorm, the landlord's insurance will cover the cost of repairing the building, but not any damage to or loss of the tenant's possessions. Tenants are responsible for insuring their belongings, and for any accidental damage they or their guests cause.
If you are renting in California, you can purchase earthquake insurance through the California Earthquake Authority (CEA). This insurance will cover your possessions and protect you from costly expenses if you need to move out while your home is being repaired or rebuilt. It is important to note that basic renters' insurance also does not cover earthquake damage, so if you want to protect your belongings in the event of an earthquake, you will need to add this to your policy. The CEA offers deductibles ranging from 5% to 25%, depending on the value of your home and when it was built. You can also purchase additional insurance, called building code upgrade coverage, to pay for any necessary upgrades to meet building code requirements when reconstructing your home.
Even if you do not live in an area prone to earthquakes, it is important to consider renters' insurance to protect your belongings in the event of other types of damage or loss. Most landlords require their tenants to have renters' insurance, and it is a wise investment to protect yourself financially.
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California is a high-risk area
The shaking caused by earthquakes can knock over and break belongings, such as a television falling off a wall. Earthquakes can also make the ground around a home unstable, a phenomenon called "liquefaction," which can fill a home with liquefied soil and ruin furniture. Earthquakes can also trigger landslides that cause severe damage to a home and its contents.
Because of the high risk of earthquakes in California, earthquake insurance is a good idea for renters. A basic renter's insurance policy won't cover losses caused by earthquakes. Most renters policies don't cover earthquake damage, but there are exceptions. In some cases, homeowners or renters insurance may specifically cover direct loss due to explosion, theft, or breaking glass caused by an earthquake, even without earthquake insurance. California law requires that both homeowners and renters insurance cover fire damage caused by or following an earthquake.
Earthquake insurance for renters is mostly available through a government program called The California Earthquake Authority (CEA). The CEA offers deductibles of 5%, 10%, 15%, 20%, and 25%, with higher minimums for homes valued over $1 million or built before 1980 on a non-slab foundation without seismic retrofitting. The CEA also offers personal property coverage, which provides up to $5,000 to replace property damaged in an earthquake, with the option to increase coverage up to $100,000. Loss of use coverage pays for temporary accommodations if a rented home becomes uninhabitable after an earthquake.
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Earthquake insurance costs vary
The construction style of the home also plays a role in determining earthquake insurance costs. Homes that are constructed with earthquake-resistant materials and designs can benefit from lower insurance costs. Additionally, the California Earthquake Authority (CEA), a primary provider of earthquake insurance, offers deductibles ranging from 5% to 25% of the home's value. The lowest available deductible is typically 15%, but this can be lower for homes valued at over $1 million or those built before 1980 on a non-slab foundation without seismic retrofitting.
The cost of earthquake insurance in California also varies by region. Los Angeles, known for its seismic activity, tends to have substantial premiums due to its dense population and proximity to major fault lines. San Diego, on the other hand, is slightly less costly, with average premiums around $1,739. San Francisco, with its history of earthquakes, also has high insurance costs. In neighbourhoods like Glen Park, premiums can reach $1,927.
It's worth noting that basic renter's insurance policies typically do not cover losses caused by earthquakes. However, renters can add earthquake coverage to their basic insurance or purchase separate earthquake insurance to protect their belongings and cover temporary living expenses if they need to move out during repairs. The cost of renter's earthquake insurance through the CEA can be as low as $35 per year, depending on factors such as location and chosen coverages and deductibles.
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Add-ons and standalone policies
In California, earthquake insurance is not mandatory for renters. However, given the state's high risk of earthquakes, it is strongly recommended that renters consider purchasing earthquake insurance to protect their belongings and cover temporary relocation costs if their home becomes uninhabitable.
If you're a renter in California and interested in earthquake insurance, you have two main options: adding earthquake coverage to your existing renters insurance policy or purchasing a separate stand-alone earthquake insurance policy.
Add-ons
If you already have renters insurance, the simplest way to get earthquake coverage is to add it to your existing policy. Contact your insurance company and inquire about adding earthquake coverage as an add-on. This option is typically available if you live in an area with a lower risk of earthquakes. However, keep in mind that most renters insurance policies do not include earthquake damage by default, so you may need to pay an additional premium for this coverage.
Standalone Policies
If you live in a high-risk area like California, you will likely need to purchase a separate earthquake insurance policy. This option is suitable for renters who want specialized coverage tailored to their needs. You can purchase a standalone policy from the California Earthquake Authority (CEA), the state's primary earthquake insurance provider. The CEA offers policies for renters and works with various insurance companies to provide coverage. Alternatively, you can explore options from other providers such as GeoVera or Arrowhead, which offer standalone earthquake policies in California.
When considering add-ons or standalone policies, it's important to understand the different types of coverage available:
- Personal property coverage: This pays for repairing or replacing your belongings, including furniture, appliances, clothing, and electronics, if they are damaged or destroyed in an earthquake.
- Breakables coverage: This covers the repair or replacement of fragile items like glassware, pottery, or porcelain, which are often excluded from standard personal property coverage.
- Loss of use coverage: This covers your temporary living expenses, such as hotel stays or restaurant meals, if you need to relocate while your rental home is being repaired or rebuilt after an earthquake.
- Debris removal: This covers the cost of removing earthquake debris from the rented property.
Additionally, keep in mind that earthquake insurance may not cover all financial losses. For example, it may not cover the replacement of all contents inside a building. Therefore, carefully review the terms, conditions, exclusions, and limits of any policy before purchasing.
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Frequently asked questions
No, earthquake insurance is not mandatory for renters in California. However, it is a good idea to have it as earthquakes can cause a lot of damage.
Earthquake insurance covers the cost to repair or replace your personal property and your temporary extra rent or hotel bills if you need to move out while your place is repaired/rebuilt.
The cost of earthquake insurance depends on factors like where you live, the coverages and deductibles you choose, the age of the building, the type of foundation it uses, and the soil type in the area. Earthquake insurance for renters in California could cost as little as $35 per year.
You can get earthquake insurance either as an add-on to your renters insurance policy or as a separate stand-alone policy. Contact your current insurance company to ask about your options. If they don't offer earthquake insurance, you can shop around or contact a local independent insurance agent who works with multiple companies.
A standard renters insurance policy likely won't cover earthquake damage, but there may be some exceptions. In some cases, renters insurance may cover direct loss due to explosion, theft, or breaking glass caused by an earthquake. Additionally, California law states that renters insurance must cover fire damage caused by or following an earthquake.
