Earthquake
Earthquake Insurance Claims in Alaska: Coverage, Deductibles and Damage
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Disclaimer: AK Claims provides general educational information only. It is not legal, financial or insurance advice, and AK Claims is not an insurance company, adjuster or law firm. Your policy language controls. For advice about your situation, consult a licensed Alaska attorney, a licensed adjuster or the Alaska Division of Insurance.
Alaska is the most seismically active state in the country, and the magnitude 7.1 earthquake near Anchorage on November 30, 2018, showed how much damage shaking can do to homes. Yet standard homeowners policies exclude earthquake damage. Coverage requires a separate earthquake endorsement or policy, usually with a high deductible.
Does homeowners insurance cover earthquakes in Alaska?
Standard homeowners policies generally exclude earthquake and other earth movement. Damage from shaking is covered only if you've added earthquake coverage through an endorsement or bought a separate earthquake policy. Fire that follows an earthquake is often covered under the standard policy, but check yours.
How earthquake deductibles work
Earthquake deductibles are usually a percentage of the coverage limit rather than a flat dollar amount. A percentage deductible on a dwelling limit can mean the homeowner pays a substantial share of repairs before coverage applies.
For example, a deductible of 10% on a $400,000 dwelling limit is $40,000. This illustrative math shows why minor cosmetic damage often falls within the deductible. Other points to check:
- Whether there are separate deductibles for the dwelling, other structures and personal property.
- Whether contents, other structures, and additional living expenses are covered at all, or at what limits.
- How the policy treats aftershocks. Many policies define a time window during which all quakes count as a single event for deductible purposes.
- Exclusions or limits for masonry veneer, chimneys, foundations, swimming pools, or land itself.
What to do after an earthquake
- Check for hazards. Smell for gas; if you suspect a leak, leave and call the gas utility from a safe place. Check for electrical and structural hazards before re-entering.
- Document early and repeatedly. Photograph and video every room, the foundation, chimney, exterior walls, garage slab, driveway and yard. Aftershocks can add damage, so dated photos help separate events.
- Notify your insurer even if you're unsure the damage exceeds your deductible. Hidden damage often appears later.
- Look for less obvious damage. Cracks in drywall corners, doors and windows that suddenly stick, separated trim, new gaps at the foundation, sloping floors, damaged water heaters and broken pipes.
- Consider a professional inspection. A structural engineer or experienced contractor can identify foundation and framing damage that's hard to see.
- Keep receipts for emergency repairs, inspections, temporary housing and storage.
Common sources of disputes
| Issue | What's at stake | What helps |
|---|---|---|
| Pre-existing vs. new cracks | Insurers may attribute cracks to settling or age | Pre-quake photos, inspection reports, a home inventory |
| Earth movement exclusions | Whether damage is from shaking (covered by quake coverage) or other ground movement | Engineering reports; the exact policy wording |
| Scope of repairs | Patch-and-paint vs. structural repair | Independent engineer or contractor estimates |
| Deductible application | Whether multiple shocks are one event | The policy's event definition and dated documentation |
Disaster assistance isn't a substitute for insurance
After a federally declared disaster, FEMA's Individual Assistance program and the U.S. Small Business Administration's disaster loans may help, and the State of Alaska has offered its own assistance programs after some disasters. These programs generally cover only basic needs and are not designed to fully restore a home. They typically require you to file insurance claims first and won't duplicate insurance payments.
Deciding whether to buy earthquake coverage
Earthquake coverage is a personal financial decision that depends on your home's construction and foundation, soil conditions, your savings, and any mortgage. Questions to ask an agent:
- What is the deductible as a percentage and in dollars for my home?
- Are contents, other structures and additional living expenses included?
- What are the exclusions and sub-limits (chimneys, masonry, foundations)?
- How are aftershocks treated?
- Are there waiting periods after purchasing coverage? Insurers commonly suspend new sales right after a major quake.
You can ask a licensed agent to compare options, and the Alaska Division of Insurance publishes consumer information on homeowners and earthquake coverage.
Frequently asked questions
Is earthquake damage covered by standard homeowners insurance?
Generally no. Standard policies exclude earthquake and earth movement. You need an earthquake endorsement or separate policy.
Why are earthquake deductibles so high?
They are usually a percentage of the coverage limit rather than a flat amount, which can amount to tens of thousands of dollars on a typical home.
Can I buy earthquake insurance right after a quake?
Insurers often suspend new earthquake coverage for a period after a significant earthquake. Coverage is best arranged in advance.