The magnitude 5.7 Magna earthquake on March 18, 2020 reminded the Wasatch Front that it sits on an active fault system. Many homeowners learned afterward that their policies didn’t cover the damage. Here’s how earthquake coverage generally works.
The standard exclusion
Most homeowners policies exclude earth movement, including earthquakes. Coverage is typically added through an endorsement or a separate policy.
Percentage deductibles
Earthquake deductibles are usually a percentage of the dwelling limit, commonly 10% to 20% or more. As an illustrative example, a home insured for $450,000 with a 15% deductible would carry a $67,500 deductible. Many smaller claims never exceed it.
Documenting earthquake damage
- Photograph cracks with a ruler or tape for scale.
- Compare with any earlier photos of the same areas.
- Note fresh, clean crack edges versus older, dirty or painted-over cracks.
- Check chimneys, masonry, foundations and plaster.
- Consider an engineer’s evaluation for structural issues.
When appraisal makes sense
If the insurer accepts coverage but disputes the amount, appraisal can resolve it. Because of high deductibles, the key question is whether the disputed amount moves the payment meaningfully. Our percentage deductible calculator makes that comparison easy.