Standard homeowners insurance policies universally exclude earthquake damage. Like flood, earthquake is a catastrophic peril that requires separate coverage. Whether earthquake insurance makes sense for you in New York depends on your location, home construction type, financial position, and available coverage options.
Your homeowners, renters, or condo policy excludes earth movement — a broad category including earthquakes, landslides, sinkholes, and earth settlement. This exclusion is standard across virtually all carriers and policy forms. Even if a fire starts as a result of an earthquake, the fire portion is typically covered but the earthquake-caused structural damage is not.
Earthquake insurance covers: dwelling damage caused by ground shaking, fault rupture, or earthquake-triggered landslide; personal property damage; additional living expenses; and in some policies, emergency repairs and debris removal. Coverage is subject to a deductible — typically expressed as a percentage of the insured value (5-25%).
Earthquake policies have unusually high deductibles. The percentage deductible means your out-of-pocket exposure before coverage kicks in is significant. On a $500,000 home with a 10% deductible, you pay the first $50,000. Understanding the deductible structure is essential to evaluating whether the coverage provides meaningful protection for your specific risk.
Factors to consider: proximity to active fault lines; soil type (soft soils amplify shaking); construction type (soft-story buildings and older wood-frame construction are most vulnerable); and replacement cost. If you have significant equity in your home and live in a seismically active area, earthquake insurance deserves serious consideration.
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Regulatory resource: New York Department of Financial Services — https://www.dfs.ny.gov. The Insurance Professor provides education only — not legal or insurance advice.