The Right Disaster Insurance for Your Region

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By: Gwen Moran
Published: September 07, 2009

Where you live dictates what kind of disaster insurance you might need to protect your home from Mother Nature’s wrath.

Real estate comes down to location, location, location. Same goes for disasters. Where you live offers clues to how susceptible your home is to damage by floods, tornadoes, hurricanes, earthquakes, wildfires, and other calamities. These regional risks also indicate whether you need to consider purchasing supplemental disaster insurance to cover claims that wouldn’t be included under a typical homeowners policy.

Determining if you live in a disaster-prone area and reviewing your existing coverage is a great start. The next step is to catalog your possessions, ideally with a digital camera or camcorder. Store copies of those files far away from your house or online at a backup storage site. That way, even if your home and computer are damaged, you’ll have proof of what was lost. Remember too to devise a family evacuation plan and assemble an emergency kit with food, water, and supplies.


Homes in low-lying areas, near bodies of water, or downstream from dams are particularly vulnerable. Saturated carpet, insulation, and drywall can promote mold growth. Since flood damage is often excluded from homeowners policies, it’s important to weigh the risk ( to your property.

At-risk regions: All

Coverage: Find out if your homeowners policy differentiates between “falling water” flooding-heavy rain, which may be covered-and “ground water” flooding, which usually isn’t. Most insurers sell flood insurance, but it may be more difficult to get in high-risk regions. The National Flood Insurance Program ( is open to anyone. Most experts recommend insuring your home and its contents at the replacement value.

Cost: The average flood insurance policy costs $540 per year, while the average flood claim over the past 10 years was $33,000, according to the NFIP.


Damage from hurricanes ( can result from heavy winds, rain, hail, and tidal or groundwater surge. Insurers in areas that have been battered by storms-especially coastal regions in the Southeast-are more skittish than those in other areas.

At-risk regions: Primarily East Coast and Gulf Coast

Coverage: In low-risk areas, your homeowners policy may cover any damage not done by rising water or groundwater surge. In high-risk areas, you may need to purchase additional coverage or participate in a state-run pool for hurricane and windstorm coverage. Your state’s insurance commissioner can provide details. Be sure to check whether additional hurricane coverage includes flooding from tidal or groundwater surge, or if you need a separate flood policy.

Cost: David Miller, CEO of Brightway Insurance in Jacksonville, Fla., says he has seen comprehensive windstorm and flood policies range from $300 for low-risk areas to up to $20,000 for high-end homes in the riskiest communities.


While earthquakes are associated with California, fault lines run through virtually every region. The U.S. Geological Survey ( tracks the latest quakes and keeps maps that show existing fault lines. Even minor earthquakes can damage belongings and leave houses structurally unsound.

At-risk regions: West Coast, especially California, and parts of Midwest

Coverage: Homeowners policies typically exclude earthquake damage. In California, supplemental coverage is available through the California Earthquake Authority ( In other states, it’s usually available from private carriers. Your state’s insurance commissioner will have information on options.

Cost: A typical earthquake policy runs between $1.50 and $3 per $1,000 of coverage per year, with a deductible of 5% to 15% of the home’s value. If a home is insured for $200,000, the deductible would be $10,000 to $30,000, possibly with separate deductibles for the structure and the contents.


Winds can reach up to 300 miles per hour and spiral into violent funnels. While there’s not much that can be done to guard against tornadoes, keeping a home’s exterior in good repair can help mitigate damage from high winds.

At-risk regions: Eastern U.S, especially Central Plains

Coverage: Tornadoes are typically covered under your homeowners insurance. However, it’s a good idea to read over your policy or call your agent for confirmation.

Cost: Homeowners insurance premiums in recent years have averaged $804 annually.


Approximately 80,000 wildfires ( burned more than 5.2 million acres in 2008. Every state but Hawaii was hit. Areas that are experiencing drought are most at risk. Damage to homes can result from flames themselves, but also from smoke, soot, and even the water used to fight the fires.

At-risk regions: All

Coverage: Fire is typically covered by a standard homeowners policy. Be sure to verify exactly what your coverage entails. Is cleanup included? How about full replacement value?

Cost: In recent years homeowners policies have averaged as low as $477 (Idaho) to as high as $1,409 (Texas).

Mine subsidence

Homes built over or near abandoned mines are at risk of structural damage if the ground shifts or sinkholes develop. Mine subsidence ( can also affect the water supply and utilities in the area.

At-risk regions: Primarily Eastern U.S.

Coverage: Mine subsidence isn’t typically covered by homeowners insurance. Coverage is usually available through state-sponsored pools, so check with your state’s insurance commissioner.

Cost: Premiums vary. In Pennsylvania, $130,000 in residential coverage is about $7 per month. In Illinois, it costs less than $95 per year to insure a house worth up to $250,000.

Gwen Moran has been writing about business, finance, and real estate for more than a decade. Her work has been published by Entrepreneur,, Financial Planning, and The Residential Specialist. A Jersey Shore resident, she has weathered hurricanes, Nor’easters, and even one small earthquake.

Source: Reprinted from HouseLogic ( with permission of the NATIONAL ASSOCIATION OF REALTORS® Copyright 2009.  All rights reserved.