Earthquakes – are you insured?

New Zealand’s 6.3 magnitude earthquake early Tuesday morning again brings into sharp focus the chilling potential for destruction and carnage resulting from seismic activity.  Early estimates of 75 dead are certain to increase as the rescue/recovery operation continues in New Zealand’s second largest city, Christchurch.   This event falls hard on the heels of a major earthquake in the same city only 5 months ago.

So far in 2011, this is the 5^th earthquake with a magnitude of at least 6* to shake some part of the globe.

As the global population grows, we are witnessing the intersection of earthquake activity and population density resulting in tragedies of historic proportions.  Haiti’s January 2010 event resulted in over 300,000 casualties, making it the 3^rd deadliest in history.

All of this, however, can seem very far from home.  At least it did until last June.

A 5.0 earthquake occurred near the Ontario-Quebec border, but was felt over a large piece of northeastern North America (including New York, Illinois, Vermont, Michigan, Massachusetts, New Hampshire, Pennsylvania, Ohio).  Surprisingly the event resulted in no fatalities or substantial damage.

It could have been worse – much worse.

Most buildings in North America have no earthquake insurance coverage – and most building owners don’t know (or remember) that reality.

But coverage is available.

As you would expect, the premium increases with the increased geographic threat of seismic activity.  Coverage usually carries much higher deductibles; but residential coverage can often be purchased in northern Ontario for approx $300.

The protection remains available – but largely unused.  The protection of insurance is forgotten, until…

*United States Geological Survey data  (other data obtained from Wikipedia).

Tags: claims, coverage, earthquake, environment, insurance, New Zealand, risk