Paul Sanchez
Landslides are considered )earth movement events, and as such, they are excluded from standard homeowners and business insurance policies. However, it is possible to purchase additional coverage, known as a Difference in Conditions (DIC) policy, to protect against landslides and other perils not typically covered by standard insurance. This type of policy is sold by surplus lines insurers and can provide peace of mind for those living in high-risk areas. The cost of a DIC policy varies depending on the coverage required and can range from several hundred to a few thousand dollars per year. While landslides may not occur frequently, the damage they cause can be significant, with an average of $3 billion in losses annually in the United States. Therefore, for those living in areas prone to landslides, mudslides, or other earth movements, considering a DIC policy can be a prudent decision to ensure financial protection in the event of a disaster.
| Characteristics | Values |
|---|---|
| Standard homeowners insurance coverage | Does not cover landslides |
| Standard business insurance coverage | Does not cover landslides |
| Difference in Conditions (DIC) policy | Covers landslides |
| Average number of landslides in the US annually | 20 to 30 |
| States with the most landslides | California, Colorado, Washington, North Carolina, Oregon, New York, Pennsylvania, Idaho |
| Cost of DIC policy | Several hundred to a few thousand dollars per year |
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What You'll Learn
Standard homeowners insurance policies do not cover landslides
In the US, landslides cause an average of $3 billion in damage every year. Despite this, landslide insurance coverage is not usually offered by insurance companies. This is because landslides are considered a type of uncovered "earth movement" that is not covered by standard policies.
If you want to insure your home against landslides, you will need to purchase a separate policy, known as a Difference in Conditions (DIC) policy. DIC policies typically cover landslides, mudflows, earthquakes, and floods. They are sold by surplus lines insurers, and your insurance professional can help you find a policy that meets your needs. DIC coverage normally costs several hundred to a few thousand dollars per year, depending on what and how much you're insuring.
It's worth noting that landslides are relatively infrequent, with only 20 to 30 occurring annually in the US on average. As a result, it's debatable whether purchasing a DIC policy is necessary unless you live in a high-risk area. The majority of landslides occur in California, Colorado, Washington, North Carolina, and Oregon. If you live in one of these states or another high-risk area, you should consider getting extra protection against landslides.
Additionally, it's important to take preventative measures to minimize the risk of landslide damage. This includes securing the ground around your home with erosion-preventing plants and building retaining walls to keep the ground secure. If you're unsure about the safety of your home, you can hire an expert to perform a ground assessment and soil sample test.
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Difference in Conditions (DIC) policies can cover landslides
Standard homeowners insurance policies do not cover landslides, as they are considered "movements of the earth", which are explicitly excluded from coverage. Therefore, to insure your home against landslides, you will need to purchase a Difference in Conditions (DIC) policy.
DIC policies are sold by surplus lines insurers and typically offer all-in-one coverage for landslides, mudslides, mudflows, earthquakes, and floods. They are highly customizable and can be tailored to meet your specific needs. DIC insurance is intended to supplement standard property insurance and is often a standalone policy, sometimes offered by a different company.
The cost of a DIC policy depends on what and how much you are insuring, typically ranging from several hundred to a few thousand dollars per year. DIC policies usually have separate limits for separate causes of loss, such as a $500,000 limit for flood damage and a $250,000 limit for landslide damage.
If you live in a high-risk area, it is recommended to consider getting extra protection through a DIC policy. The majority of landslides in the US occur in California, Colorado, Washington, North Carolina, and Oregon.
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Landslide insurance is costly and may be unnecessary
Landslide insurance is not typically included in standard homeowners insurance policies. Landslides are considered "earth movement" events, which are explicitly excluded from coverage. As a result, homeowners in high-risk areas may need to purchase additional insurance, known as a Difference in Conditions (DIC) policy, to protect their homes from landslides.
However, obtaining landslide insurance can be costly and may be unnecessary for some homeowners. DIC policies can cost several hundred to a few thousand dollars per year, depending on the coverage required. Since landslides are relatively infrequent, with only 20 to 30 occurring annually in the US on average, the likelihood of a landslide occurring in a particular location is low for most homeowners.
In addition, there are alternative ways to mitigate the risk of landslide damage. Homeowners can take preventative measures, such as securing the ground around their property with erosion-preventing plants or building retaining walls. These measures can help minimize the potential damage caused by landslides.
Furthermore, landslides can sometimes be triggered by covered events, such as earthquakes. In such cases, homeowners with supplemental earthquake insurance added to their standard policy may be able to receive coverage for landslide damage without needing a separate DIC policy.
Therefore, while landslide insurance is available, it may not be necessary for all homeowners. The decision to purchase additional coverage should be based on a careful assessment of the risk level in the specific location, the potential impact of a landslide, and the availability of alternative risk mitigation strategies. Homeowners should weigh the cost of insurance against the likelihood of a landslide occurring and the potential out-of-pocket expenses they could face if a landslide damages their property.
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Landslide insurance claims may come with a deductible
Landslides are considered "earth movement" events, and as such, they are excluded from standard homeowners and business insurance policies. This means that if a landslide damages your property, you will not be able to claim the cost of repairs on your insurance unless you have additional coverage.
Difference in Conditions (DIC) policies, also known as "gap coverage", can be purchased to protect against landslides and mudslides. These policies typically cover floods, earthquakes, landslides, and mudflows, which are excluded from standard insurance policies. However, it's important to note that not all insurance companies offer DIC policies, and they can be quite costly, ranging from several hundred to a few thousand dollars per year.
If you have a DIC policy or other additional insurance protection, it's important to understand that landslide insurance claims may come with a deductible. This means that you will be responsible for paying a certain amount out of pocket before your insurance coverage kicks in. To prepare for this, it's recommended to set aside funds specifically for this purpose in a dedicated savings account.
The process of filing a landslide insurance claim may differ from a standard claim. Typically, insurance companies will ask for documentation of the damage included in the claim. However, in the case of a sudden landslide, you may be forced to evacuate your home immediately without having the opportunity to document the damage. In such cases, it's crucial to contact your insurance agent as soon as possible to initiate the claim process and request coverage for temporary living expenses.
To mitigate the risks associated with landslides, it's advisable to take proactive measures such as securing the ground around your home with erosion-preventing plants and building retaining walls. Additionally, if you're unsure about the stability of your property, consider hiring an expert to perform a ground assessment and soil sample test. These steps can help minimize the potential damage caused by landslides and ensure your safety.
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Some insurers offer coverage for landslides caused by earthquakes
Landslides are typically considered "earth movement" events and are excluded from standard homeowners and business insurance policies. However, some insurers offer specialised coverage for landslides, often referred to as "Difference in Conditions" (DIC) or "gap coverage" policies. These policies are designed to fill the gaps left by standard insurance policies and typically cover landslides, mudflows, earthquakes, and floods. They are sold by surplus lines insurers, and your insurance agent or broker can assist in finding a suitable provider.
While earthquakes also involve earth movement, they are generally caused by seismic activity rather than erosion or water accumulation. As a result, separate earthquake insurance policies are typically required for quake-caused property damage. However, some insurers offer comprehensive coverage that includes both earthquake and landslide protection.
It is important to note that not all companies offer DIC or comprehensive policies that cover landslides. The availability of such coverage may depend on the state and the specific insurers operating in that region. For example, in California, realtors often require customers to sign a document outlining the home's risk of natural disasters, including landslides.
If you live in an area prone to landslides, it is essential to review your insurance policy carefully and consider purchasing additional coverage if needed. The cost of repairing damage caused by a landslide can be significant, and standard homeowners insurance policies typically exclude coverage for landslides and other earth movements.
Additionally, it is worth mentioning that, in the event of a landslide, insurance companies typically require customers to document the damage as part of the claims process. This may include taking photos or videos of the damage and providing detailed information about the incident. It is crucial to file a claim as soon as possible, as officials may restrict access to the area for several days due to unsafe conditions.
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Frequently asked questions
Landslides are not covered by standard homeowners or business insurance policies. They are considered "'earth movement' events and are excluded from coverage.
To insure your home against landslides, you will need to purchase a separate policy known as a Difference in Conditions (DIC) policy, which covers landslides, mudslides, floods, and earthquakes.
A DIC policy typically costs several hundred to a few thousand dollars per year, depending on what and how much you're insuring.
If your home has been damaged by a landslide, contact your insurance agent as soon as possible to file a claim. Document the damage and ask for a check to cover temporary living expenses if you have been forced to evacuate.
