Earthquake insurance might not be the answer, but this is a question you should ask yourself BEFORE another one hits the Puget Sound area.
A litte more than five years ago, the 6.8 magnitude Nisqually Quake shook the central Puget Sound basin, causing nearly $3 billion damage and spawning 9,500 insurance claims.
The fault that caused it isn’t even the most problematic. The Pacific Northwest is crisscrossed with faults. One off the Washington coast is substantial enough to cause a magnitude 9 quake and catastrophic damage. Yet only 12 to 15 percent of local homeowners carry earthquake insurance. Some owners may not have it because they believe – erroneously – that their regular homeowners’ policy covers quakes.
There’s a joke in the insurance industry about mind-set. It’s nicknamed the “Air Force One Solution” – based on the myth that the president will surely fly over our disaster zone and drop $100 bills from his plane. Good luck with that!
Help from the government is very limited. The Federal Emergency Management Agency provides only limited assistance. The cap on FEMA grants to a single household is $26,200.
If the worse-case scenario struck, most homeowners would still owe the bank hundreds of thousands of dollars on top of their reconstruction costs.