Frequently Asked Questions
Answers to your questions about California Earthquake Authority (CEA) earthquake insurance
Deductibles and Discounts
- Does CEA require policyholders to "pay" a deductible out-of-pocket?
- What are my deductible options?
- Do you offer any discounts if my home has been earthquake retrofitted?
Condo and Renters
- I own my condo unit. Are there coverage options for me?
- I rent, so will my landlord's policy cover my belongings?
A: Most homeowners, mobilehome, condo and renters policies don't cover earthquake damage.
And most Californians live within 30 miles of an active fault, capable of producing damaging earthquakes. There are 2,000 known faults crisscrossing California, and on average, according to the official California Multihazard Mitigation Plan:
- Moderate earthquakes (magnitude 5.5) strikes California 3 to 4 times a year.
- A strong earthquake (magnitude 6 to 6.9) strikes California every 2 to 3 years.
- A major earthquake (magnitude 7 to 7.9) strikes California about every 10 years.
Your earthquake risk is real. According to the Uniform California Earthquake Rupture Forecast (UCERF3), within the next 30 years, there is a:
- 99.7% chance a 6.7M quake or larger will strike California.
- 46% chance a 7.5M or greater earthquake will strike, likely in Southern California.
- 68% chance a 7.0M quake will happen in Northern California.
A: Government assistance is not always available. You must first qualify, and grants are often limited to urgent health and safety needs. And government loans for rebuilding may be limited and must be repaid, in addition to your mortgage. In other words, the intent behind this type of assistance is to help you get back into your home, not to offer enough funds for you to rebuild or fully replace your property.
A: No. The deductible is the amount deducted from the insured loss—you do not have to pay any portion of your deductible to receive a claim payment. And, two CEA coverages come with zero deductible: the first $1,500 of emergency repairs for homeowners and mobilehome owners, and, if a home can't be occupied after an earthquake, up to $100,000 for Loss of Use expenses.
A: Policyholders can choose deductibles from 5 to 25 percent on all coverages that carry a deductible.
For Homeowners, you have two choices of policies: Homeowners Choice or standard Homeowners . With Homeowners Choice, you have the option of adding Personal Property with a separate deductible--this feature can allow a personal property payment, even if your house isn't substantially damaged.
- With Homeowners Choice , you buy dwelling coverage, but may also insure personal property, cover additional living expenses, or both.
- Standard Homeowners policy includes dwelling, personal property and additional living expense coverages.
- The first $1,500 in Emergency Repairs, as well as the cost to live elsewhere while your house is being repaired, come with no deductible.
A: Yes. CEA policyholders who have retrofitted their house to better withstand earthquake damage will receive a premium discount of up to 20 percent if their house meets the following requirements:
- The house was built before 1979;
- The house is of wood-frame construction;
- The house is built on a raised foundation. If your house has a post-and-pier foundation, the retrofit must comply with state building codes;
- The house's wood frame is secured to the concrete foundation;
- The house's water heater is secured to the house's wood frame; and
- The house's cripple walls (any walls under the main floor that are less than full-story height––not all houses have them) are braced with plywood or equivalent, in accordance with state building codes.
The California Residential Mitigation Program’s (CRMP) Earthquake Brace + Bolt Program also offers up to $3,000 in financial incentives to help qualified homeowners complete this type of retrofitting. (CRMP grants are not included in, or a benefit of, CEA earthquake insurance.)
A: Condo unit owners have unique needs. Condo association master earthquake policies usually don't cover damage to your personal belongings or damage to the inside of your home. And while some associations may cover earthquake damage to a condo building's exterior or common areas, many also require unit owners to pay a portion of the repair costs or the association's policy deductible (by levying a loss assessment). CEA offers a
condo unit policy with coverage for your belongings and the interior of your condo unit, as well as loss assessment coverage.
A: No. If you rent, you need a separate renters policy to cover your personal belongings. CEA renters earthquake insurance insures personal property such as TVs and furniture, with deductibles ranging from 5 to 25 percent, and covers additional living expenses—if you must live and eat elsewhere following a quake—of up to $100,000 with no deductible.
A: CEA has reduced homeowners rates since 1996 by nearly 55 percent, making earthquake insurance more affordable than ever!
As a not-for-profit, CEA rates are based on science and straightforward, objective risk factors. Determining factors are the insured value, location, construction- and foundation-types, age, number of stories and coverage choices.
A: CEA has a claim-paying capacity of more than $13 billion. Also:
- CEA is financially sound, with an A- (Excellent) rating from A.M. Best Co., the world's leading rating agency of insurance companies.
- CEA is privately funded. We don't receive any money from the state, so state budgets or deficits have no impact on our ability to pay claims.
Next Steps! Get a policy premium estimate and contact your home insurance company to buy a CEA policy!
Read your CEA policy carefully
We encourage you to read your entire CEA policy to see what is covered and what is not. Exclusions and special limits apply.
All details, limits, and conditions of CEA coverages are found in CEA insurance policies. Refer to a Sample Policy, below, for the full terms and definitions.