Every year, over 4,000 recorded earthquakes occur in Canada. In earlier days, earthquakes were unpredictable. In the present time, with the help of technology, we can gauge them to some extent. Our lives and possessions are at risk when we live in earthquake-prone areas.
Did you know earthquake insurance in Canada is worth buying? Let us dive right in to know more about Canadian earthquake insurance policies.
What is earthquake insurance?
Earthquakes are natural disasters causing massive destruction. We have no control to predict most accurately when they might happen. It is necessary to prepare for the worse and to have insurance coverage just in case.
Earthquake insurance is a vital type of coverage you would want to make sure you have to protect your home from the damage caused by an earthquake.
Do you need to buy earthquake insurance?
Earthquake insurance is not a requirement in Canada. However, most home insurance plans do not cover earthquake damage. But being able to protect your items from damage caused by an earthquake is one of the main reasons you should get earthquake insurance.
The laws of your province or territory determine the coverage. Also, keep in mind that your premiums for earthquake insurance might be higher than any standard insurance premiums.
The cost of your premium depends on the following things:
- Location of your home.
- How old is your house?
- Coverage limit you want for your house.
- Amount of the deductible.
A deductible is a percentage of the coverage limit for your earthquake insurance add-on. The deductible amounts might range from 5% to 20% for earthquake insurance.
For example, if your insurance coverage is C$100,000 and your deductible is 10%, you will pay C$10,000 as a deductible. However, because of the deductible, you may not always be able to collect compensation if an earthquake damages your home.
Although some insurance companies will allow you to lower your deductible, they increase your premium.
Who should buy earthquake insurance?
If you live in an earthquake-prone area, earthquake coverage is imperative for your family. You can also ask your insurance agent to suggest ways to reduce earthquake damage to your home. If you are in an area with less probability of earthquakes, you might be fine with your current home insurance coverage. Instead, you can also put that money in your emergency fund.
What does earthquake insurance cover?
There are many insurance policies available to provide coverage for earthquake damage. What you choose depends on many factors. Earthquake insurance provides cover for the following instances:
- Damage to your house and any extensions, such as swimming pools or attached garages, and the repairs.
- If your possessions get damaged because of an earthquake, you can have them repaired or replaced.
- Additional living expenses you have incurred because of the earthquake.
Earthquakes are unpredictable and can cause a lot of damage to your home and your wallet. About getting earthquake insurance, contact your home insurance agent.
Read ‘What Are the Life Insurance? Which Is Right for You?’ to find out more about different insurances and find which one suits your needs the best.