Earthquake damage is not covered by a regular homeowner's policy. Earthquake policies carry high deductibles—at least 10 percent of a home"s value. Often, policies do not cover more than a few thousand dollars for furniture, dishes, electronics and other contents destroyed in a quake. Premiums are expensive.
As a result, nearly 90 percent of homeowners in the Golden State do not have quake insurance, according to the California Earthquake Authority.
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The California Earthquake Authority was set up after the 1994 Northridge quake. At that time, 40 percent of homeowners had earthquake insurance, but most companies stopped writing earthquake policies in California after being hit with a reported $12.5 billion in claims.
At first, the CEA offered only policies with a 15 percent deductible and $5,000 worth of personal property coverage. Few people signed up. The CEA has since provided more coverage options, including up to $100,000 in personal property coverage, but that comes with even higher premiums.