Earthquakes And Your North Carolina Property Insurance Policies – Will They Be Useless To You?

If you have lived your entire life in North Carolina, then earthquakes are probably not something that you think much about.  In our lifetimes, the earth under our feet has not shaken often or dramatically and we have built lifestyles and societies around the concept that the earth does not move under our feet.    But this year and last year are the 200^th anniversaries of the strongest earthquakes ever to occur in the continental United States.  These three earthquakes were so strong that they were felt from St. Louis and west all the way into northern New England.  And they happened right in our back yard.

In 1811 and 1812, three earthquakes on the New Madrid fault line were estimated at magnitudes above 8.0.  Aftershocks from these quakes numbered in the thousands and went on for several years.  These three mighty earthquakes were so strong that they caused the Mississippi river to reverse course and flow north for a period of time.  Most of the loss of life from these quakes occurred on the river where boats were capsized by the huge waves created by these quakes.  Most of the property damages occurred to crops where entire fields were churned to soup and rock falls buried fields.   But without the complicated and intricate infrastructure of our time with our underground gas lines and extensive property construction, there were no great fires and no huge loss of life figures to keep these earthquakes fresh in our memories.  For the most part the New Madrid earthquakes of 1811 and 1812 have been largely forgotten.

The New Madrid fault line runs in the vicinity of St. Louis to Memphis but because of the type of subterranean rock on the east coast, tremors and shocks from New Madrid are felt for thousands of miles.  In 1811 the New Madrid earthquake is said to have rung church bells in Boston.  This fact makes those of us living in and owning property in North Carolina a bit more vulnerable than we may think.

Experts now estimate that an 8.0 or higher earthquake originating on the New Madrid fault would probably leave behind damages well above $100 billion.  Yes, that is billion with a B.  In this part of the country we simply have not built for or prepared for earthquakes in the same way as has been done in California and Alaska where earthquakes are more common.   And worse still, most of those losses would be uninsured losses so recovery would be much slower and less efficient.

What does this mean for you?  Start by understanding that in NC, earthquake damage is not automatically covered by the standard homeowners insurance policy.   This is also true for those of you who own commercial property insured by the standard businessowners insurance policy or commercial property insurance policies.  Also, any homes that you own and that you rent to others, usually insured by a dwelling fire insurance policy, will also have no earthquake coverage.  How tough will it be to borrow money to rebuild your home or business when you have to compete with almost every other citizen doing the same thing?

But earthquake coverage is not unavailable, it’s just not automatically included in the standard policy form.  In almost every case you should be able to add earthquake coverage to your existing NC property insurance policies for an additional premium charge.   This coverage is generally more expensive for homes and buildings that are constructed of masonry or brick veneer compared to frame buildings.  This is because masonry structures don’t flex as well with the shaking ground and usually experience much greater damage from earthquakes.  Also, be careful to understand the special deductible forms that often apply to earthquake insurance.  Many even calculate the deductible that you must pay after a loss as a percentage of the total damage caused to your property by the quake.

With the 200^th anniversary of the strongest earthquakes ever to occur in the continental US here before us now, some might feel that having gone this far, we will never see one.  But seismologists will tell you that every year that passes without a New Madrid fault quake, simply increases the odds that it will happen next year.  Going without protection is much easier than getting it.  All you have to do to be uninsured is do nothing at all.  But if you would like some help in understanding your options for earthquake insurance on your North Carolina property, I hope you will give us a call, toll free at 877-687-7557 or visit us on the web at www.ClinardInsurance.com.