Earthquake Insurance

Earthquake Insurance Costs

All you need to know about earthquake insurance costs.

For people all over the world their homes are their biggest asset and not taking proper care of it or repairing it when it gets damaged ends up in a waste of money and energy. Now when it comes to natural disasters like earthquakes, floods etc it becomes vital for the owner of the building to insure his asset incase of such emergency. Else the cost to bear if the building is not insured would take a hefty toll on the person affected. For example, during the event of an earthquake you may not be able to save any of the items in your building or household, or the damages inflicted upon your building may be more than you could pay for. So what does this lead to? More loans from the banks? More debts to be burdened with? In this way a person just ends up going around in circles and may finally end up in what is called a debt-trap. Instead of having to bear innumerous number of debts isnít it simpler to just insure your valuables for a specific amount of money?

Earthquake insurance cost rates are differently determined by different companies. It also depends on the material of which the house is made- wood or brick. Wooden houses tend to withstand more force than brick houses. Along with that areas are graded on a scale of 1 to 5 for being most affected by earthquakes, and this affects the earthquake insurance costs as well. It is vital for one to know that the limits on the earthquake insurance will fully replace what you are insuring and is not limited to the total cost to rebuild or even temporary living expenses. Speaking of temporary living expenses, it is also necessary to realize the amount which you may have to pay post earthquake in order to temporarily live in any place, thus getting value for money.

Shop around for cover

When you have received your quotes and compared them to the quotes of other insurance companies it is necessary for you to try and understand the coverage and justify the earthquake insurance cost. Some people do not wish to opt for earthquake insurance schemes but that doesnít mean that is a wise and economical idea since you could later on owe a hefty mortgage to the bank on the house that has been destroyed especially if you are living in an area which may coincide with an earthquake prone zone. It is always necessary to have your quotes narrowed down to the best prices i.e. the lowest deductibles or even the service you feel happiest with.

Risk assessment

When an insurance company assess the risk of earthquake damage they estimate how well the structure can respond to situations of earthquakes and how long it would be able to withstand it. Things affecting how much damage can be controlled by the building include the height of the building, non-structural additions to the building like a garage etc., kind of structural system and material used-wood or glass.

Insurers cannot predict the damages which can be inflicted on any building by an earthquake yet they try to estimate the insurance cost as close to the value or even more than the value of the building in question, thus trying to make the damage projections more accurate.

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