Earthquakes and Insurance

Last week Northern New England experienced an earthquake that reached 4.0 on the Richter Scale. The earthquake was deemed to be light with fortunately no serious damage reported and no people were injured from the event.

This serves as a good opportunity to remind people that protection against earthquakes is not a covered peril under common homeowner’s and business insurance policies. Flood insurance is commonly known as something that needs to be bought separately, but most people who don’t live in an area with high seismic activity often forget that earthquake damage is not covered either.

An earthquake in New England is a rare event, but they do occur. In the 1700’s, an earthquake struck the North Shore of Massachusetts with an estimated reading of 6.1 on the Richter Scale while the largest earthquake in Maine was in Eastport with an estimated reading of 5.8. Many people remember the earthquake centered in Plattsburg New York in 2002 that had a magnitude of 5.1. Compounding the risk is the fact that the geology of Northern New England typically doesn’t respond to seismic activity very well and most of our buildings are not built to the same standards as Japan or California.

Now this blog isn’t meant to alarm anyone. But I do think it is healthy to periodically review the risks that confront us, determine if the risk is insurable and if so, determining if it economically makes sense to insure against the risk. It also never hurts to review your homeowner or business insurance periodically to become fully aware of what risks aren’t covered under your policy.

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