My Property Management FAQ's > Insurance > Should I purchase earthquake coverage?
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This is a very personal question and one that you must discuss with your insurance agent, as well as your accountant. The decision is based upon three factors: First the likelihood of suffering a loss during your ownership period. Second, the cost of the earthquake coverage. Third, your personal tolerance for risk, which is at least partially determined by your financial situation.
If you determine earthquake coverage is unaffordable or is not meaningful (e.g. the deductible is too high), we strongly recommend you at minimum look into improving your building structure to increase its ability to withstand an earthquake.
While it is unlikely you will want to rebuild your building, you will be amazed at how much improvement you can offer the building with a minimum of improvement. It is likely the largest benefit will come from the initial dollars spent. Those dollars are a terrific investment in your property.
Last updated on October 13, 2008 by MRU Managing Editor