Jane Dotson
The California Earthquake Authority (CEA) is the largest residential earthquake insurer in the US, providing earthquake insurance to homeowners, mobile home owners, condo unit owners, and renters. CEA insurance covers damage to your home and belongings, as well as additional living expenses incurred while your home is being repaired. However, it does not cover landscaping, pools, fences, masonry, or separate buildings. The cost of CEA insurance depends on various factors, including the earthquake risk in your area and the coverages and deductibles chosen. While CEA insurance can provide valuable protection against financial losses due to earthquake damage, it's important to carefully review the policy's exclusions and limits before purchasing.
| Characteristics | Values |
|---|---|
| Provider | California Earthquake Authority (CEA) |
| Type of Insurance | Earthquake insurance |
| Coverage | House damage, personal belongings, additional living expenses or loss of use |
| Cost | The average cost of earthquake insurance is about $850 per year |
| Discounts | Up to 25% for older houses that have been properly retrofitted to better withstand earthquakes |
| Exclusions | Landscaping, pools, fences, masonry, separate buildings, vehicles |
| Purchase | Cannot be bought directly from CEA, must be purchased from insurance companies that are members of CEA |
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What You'll Learn
CEA insurance covers damage to your home and belongings
The California Earthquake Authority (CEA) is the largest provider of residential earthquake insurance in the United States, issuing 65% of the residential earthquake policies sold in California. CEA insurance covers damage to your home and belongings in the event of an earthquake.
Basic California Earthquake Authority insurance covers house damage, up to the same dollar amount covered by your homeowners insurance policy. Some items are excluded, such as pools, fences, and landscaping. However, older homes may qualify for a discount of up to 25% if they have been properly retrofitted to better withstand earthquakes.
Personal belongings are covered from $5,000 up to $200,000. This includes furniture, TVs, clothes, toys, and computers. Things like china and crystal are covered through optional breakables coverage.
The CEA Homeowners Choice policy offers the option of choosing separate coverage for dwellings and personal property, with different deductibles. With Choice, you may also choose to only purchase coverage for your dwelling and decline other coverages.
In addition to covering damage to your home and belongings, CEA insurance also provides coverage for additional living expenses or loss of use. This covers temporary and extra costs incurred while your area is evacuated or your home is being repaired due to earthquake damage. This can include the temporary rental of a home, apartment, or hotel room, restaurant meals, a temporary telephone line, moving and storage, furniture rental, and laundry.
It is important to note that CEA insurance does not cover everything. Common exclusions include damage to vehicles, which would need to be covered under a comprehensive auto insurance policy, and damage to separate buildings, landscaping, pools, fences, or masonry. Additionally, earthquake insurance typically does not cover anything that your homeowners policy already covers, such as fire damage.
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CEA insurance does not cover damage to your vehicles
The California Earthquake Authority (CEA) provides earthquake insurance and coverage options for California homeowners, mobile home owners, condo unit owners, and renters.
Other common exclusions in earthquake insurance policies include damage that your homeowners' policy already covers, such as fire damage, even if it is caused by an earthquake. Earthquake insurance also usually does not cover damage to your land, such as sinkholes from erosion or other hidden openings.
It is important to carefully read your entire CEA policy, including the policy declarations page, to understand your coverage and any exclusions or special limits.
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Discounts are available for older homes that have been retrofitted
The California Earthquake Authority (CEA) is the largest residential earthquake insurer in the US, issuing 65% of residential earthquake policies in California. It was created in 1996 to address a serious financial crisis in the state, following the 1994 Northridge earthquake, which caused an estimated $26.4 billion in insured losses.
CEA insurance covers damage to your home and belongings, and can also pay for living expenses while your home is being repaired. However, it does not cover landscaping, pools, fences, masonry, or separate buildings.
One way to strengthen your home against earthquakes is through seismic retrofitting, which involves reinforcing the foundation to make it more resistant to shaking. Retrofitting can take a few weeks and does not guarantee that your home will not be damaged in an earthquake, but it does make it more resilient.
CEA offers discounts of up to 25% on earthquake insurance premiums for older homes that have been properly retrofitted. This discount is available for homes that have been retrofitted through the Earthquake Brace + Bolt (EBB) and Earthquake Soft-Story (ESS) programs. By taking advantage of these discounts, older homeowners can not only reduce their financial burden but also improve the safety of their homes in the event of an earthquake.
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CEA insurance can cover additional living expenses
CEA insurance, or earthquake insurance from the California Earthquake Authority, can be a valuable form of coverage for homeowners, mobile home owners, condo unit owners, and renters in California. While it does not cover damage to your land, separate buildings, or vehicles, it can provide essential protection against financial losses related to earthquake damage to your home and belongings.
One of the key benefits of CEA insurance is its coverage of additional living expenses (ALE), also known as loss of use. This component of the policy can help ease the financial burden of temporary relocation and additional costs incurred while your home is being repaired or evacuated due to earthquake damage.
ALE coverage under CEA insurance can reimburse you for various expenses, including the temporary rental of a home, apartment, or hotel room, restaurant meals, a temporary telephone line, moving and storage costs, furniture rental, and even laundry expenses. These reimbursements ensure that you can maintain your standard of living while displaced from your home.
It is important to note that ALE coverage under CEA insurance has certain limitations. It is designed to cover only the reasonable time needed for home repairs or relocation to a new permanent residence. Additionally, ALE reimbursements are based on the difference between your everyday living expenses and the additional costs incurred during the covered loss period. Therefore, it is crucial to maintain detailed records and receipts to support your reimbursement claims.
In conclusion, CEA insurance, including its coverage of additional living expenses, can provide valuable financial protection for California residents in the event of an earthquake. By understanding the inclusions and exclusions of the policy, homeowners can make informed decisions about their coverage needs and ensure they are prepared for potential earthquake-related expenses.
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CEA insurance can be purchased through residential insurance companies
The California Earthquake Authority (CEA) is the largest provider of residential earthquake insurance in the US. It was created in 1996 after the 1994 Northridge earthquake, which caused $26.4 billion in insured losses. The CEA is a non-profit entity that is privately funded and publicly managed. It does not sell insurance directly to consumers, but it does work with residential insurance companies that serve the majority of California homeowners.
To be eligible to purchase a CEA earthquake policy, you must be a Californian whose home is insured by one of the companies that work with the CEA. You must purchase your CEA policy from the same insurance company that you have your residential policy with. You can use the CEA Premium Calculator to get a free estimate for a CEA California residential earthquake insurance premium. The cost of your policy will depend on factors such as the earthquake risk where you live and the coverages and deductibles you choose.
CEA insurance covers damage to your home and belongings. It can also pay for living somewhere else while your home is being repaired. You can choose between two policies: purchasing all of your coverages together under one deductible, or choosing to have separate deductibles for your dwelling and personal property. There are also optional coverages, such as coverage for personal belongings and loss of use.
CEA insurance does have some exclusions. It usually does not cover anything that your homeowners policy already covers, such as fire damage. It also does not cover damage to your land, such as sinkholes, or to separate buildings, pools, fences, masonry, or vehicles.
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Frequently asked questions
The California Earthquake Authority (CEA) is the largest residential earthquake insurer in the U.S. It offers earthquake insurance policies for homeowners, mobile home owners, condo unit owners, and renters.
Earthquake insurance is generally recommended for those living in earthquake-prone areas. CEA insurance is worth considering as it offers coverage options for any budget. However, it's important to note that CEA insurance has several exclusions, including damage to landscaping, pools, fences, masonry, and separate buildings.
CEA insurance covers damage to your home and belongings resulting from an earthquake. It also provides additional living expenses (ALE) or loss of use coverage, which pays for temporary costs incurred while your home is being repaired or evacuated.
The cost of CEA insurance depends on various factors, including the earthquake risk in your area and the coverage and deductible options you choose. The average cost of earthquake insurance in California is around $800 to $850 per year.
