Recently, Hurricane Harvey ravaged Texas, and Hurricane Irma is currently threatening parts of Florida and South Carolina – prompting declarations of a state of emergency in both states. Hurricanes can be, and usually are, devastating when they make landfall. The only real positive side is that, thanks to modern technology, we can receive an early warning as to their formation and track their progress. Unfortunately, not all natural disasters can be predicted with any reasonable accuracy.
That’s why it’s so important to buy natural disaster insurance. Your run-of-the-mill homeowners insurance policy typically doesn’t cover anything even remotely approaching a natural disaster, and no matter where you live in the United States, you’re at risk of experiencing one kind or another.
Here in California, earthquakes are a big one (no pun intended). To protect yourself in the event of an earthquake, you’ll need to buy natural disaster insurance either as a standalone policy or as an endorsement to your homeowners or renters insurance. Earthquake insurance is available from most insurance companies, and in California, it’s also available from the California Earthquake Authority.
The next major natural disaster most Californians face is that of a brush or wildfire. We all know they happen all the time, and while firefighters work tirelessly to contain the blazes, homes and other structures are inevitably lost in many cases. As of September 2, 2017, 312 homes and structures have been destroyed by wildfires throughout the state. With the millions of homes that exist in California, that’s a very small number, however, if you decide not to purchase insurance for that reason, you’re playing with fire (pun intended). Unlike other natural disaster insurance such as earthquake and flood, fire insurance is not an added policy; it’s part of your home insurance policy. Problems can arise when a home is in or near a brush area. Homeowner’s insurance is difficult to obtain and property owners are left with the CA Fair Plan/Wrap Around policies, or expensive Surplus Lines insurance policies. These are a last resort.
Last but not least we have floods. Flood insurance is available for both homeowners and renters, and must be purchased from either a private insurance company or from the National Flood Insurance Program. It’s possible to get replacement cost coverage for the structure of your home, but flood insurance usually only allows for actual cash value for any possessions ruined.