Earthquakes are not covered under standard homeowners or business insurance policies. Coverage is generally available in the form of a supplemental policy that provides protection from the shaking and cracking caused by earthquakes that can destroy buildings and personal possessions. Coverage for other kinds of related damage, such as fire and water damage due to burst gas and water pipes, is generally provided by standard homeowners and renters insurance policies.
In California homeowners may also secure coverage from the California Earthquake Authority (CEA). The CEA offers more options for homeowners dwelling coverage, including deductibles from five to 25 percent and other enhancements.
Cars and other vehicles are covered for earthquake damage under the optional comprehensive portion of auto insurance policies.
Earthquakes happen far more often in the U.S. than commonly believed. In 2015 there were 32 earthquakes of magnitude 4.0 and higher in Kansas, Oklahoma and Texas, compared with 17 in 2014. The biggest earthquake to strike the U.S. recently was a magnitude 6.9 quake that occurred on July 27, 2015, southwest of Umnak Island, Alaska. Due to the remote location, there was no damage. Moderate earthquakes with no fatalities also occurred in Nevada and Arizona.
Eight of the costliest U.S. quakes, based on inflation-adjusted insured losses, were in California, according to Munich Re. On August 24, 2014, a 6.0-magnitude earthquake struck South Napa, California, killing one person and causing $700 million in total damage and $150 million in insured losses.