How California Earthquake Insurance Actually Pays: Deductibles, Contents and Loss of Use

From Speaking of Insurance · 15:02

Show by Brian Bollinger, Aaron Bollinger

Most California homeowners know their home insurance policy does not cover earthquake damage. Fewer know what happens when they do buy earthquake insurance. They are surprised by a deductible measured in six figures, and surprised that their furniture claim depends on the damage to the house.Aaron Bollinger of Bollinsure Insurance Services walks through how a California earthquake policy actually pays, with real numbers: percentage deductibles, contents and loss of use, retrofit discounts, fire following an earthquake, the private market, and a full claim example.What we cover:Why earthquake deductibles are a percentage of the dwelling limit, not of the damageCEA deductible choices of 5, 10, 15, 20 and 25 percent, and who can pick the lower onesCoverage A, B, C and D on a CEA homeowners policy, and why the limits do not automatically match your home policyStandard versus Homeowners Choice: how each one treats contentsLoss of use with no deductible, emergency repairs, and building code upgrade coverageSeismic retrofits, CEA premium discounts, and Earthquake Brace + Bolt grantsWhy fire following an earthquake goes to your homeowners policyPrivate and surplus lines earthquake coverage, and the CIGA trade-offExample: a 1962 Pasadena home with an $800,000 limit and a 15% deductibleThree common mistakes, what to bring to a review, and four questions to askResources:All Speaking of Insurance episodesHome insurance in CaliforniaRead the guide: How California earthquake insurance paysClarificationsAround 3:25, "covered B" means Coverage B, the extensions of the dwelling.Around 3:50, the CEA rule is correct: homes with a dwelling limit over $1,000,000 cannot choose the 5% or 10% deductible. The same applies to pre-1980 raised foundation frame homes without a verified retrofit. Those homes choose 15%, 20% or 25%.Around 5:37, on a Homeowners Choice policy the contents deductible is waived once the dwelling deductible is met. Homeowners Choice contents limits run from $5,000 to $25,000.Around 8:40, the California law on fire following an earthquake is Insurance Code section 10088.5. The fire is covered under the fire or homeowners policy, subject to that policy's terms and deductible.Around 9:50, "sometimes worse to the CEA" means sometimes worse than the CEA.The CEA is a publicly managed, not-for-profit earthquake insurer whose policies are sold through participating home insurance companies.Brace + Bolt grants of up to $3,000 are run through the California Residential Mitigation Program. Eligible zip codes change each year.Get quoted: Compare earthquake coverage options with Bollinsure Insurance Services at www.bollinsure.com/quote, or call 562-268-9355.CA License 6013787This episode is for general education only and is not legal, tax, or coverage advice. Coverage, eligibility, and pricing depend on the carrier, underwriting, and your policy terms.Chapters00:00 Cold open: the six figure surprise00:23 Welcome and what this episode covers01:05 Disclaimer03:00 Percentage deductibles04:12 Why the deductibles are so high04:36 Contents and loss of use04:58 Standard versus Homeowners Choice06:02 Loss of use, emergency repairs and code upgrades07:02 Retrofits, discounts and Brace + Bolt08:20 Fire following an earthquake09:15 The private market10:18 Example: a Pasadena claim with numbers12:45 Three common mistakes13:28 What to bring to a review, and four questions14:21 Getting help and sign-offTranscript excerptMost California homeowners know their home insurance policy does not cover earthquake damage. Fewer know what happens when they do buy earthquake insurance. They are surprised by a deductible measured in six figures. They are surprised that their furniture claim depends on the damage to the house.… Full episode on bollinsure.com

More episodes of Speaking of Insurance

More episodes

PodSearch is a free, independent podcast search engine. Read about PodSearch, the privacy policy or contact us.