3 misperceptions about earthquake insurance in Massachusetts and Rhode Island

In January 2015, after a series of Connecticut-based earthquakes that reverberated in Rhode Island and as far away as New Bedford, MA, I began hearing from clients wondering if they were covered for losses resulting from a quake. It was a good question.

Many people assume damage caused by an earthquake is covered by their homeowners policy, but in most cases, that’s incorrect. It’s also just one of several misconceptions people have about earthquake insurance in Massachusetts and Rhode Island. Here are three, beginning with the one we’ve already touched on:

1. My homeowners policy covers damage caused by an earthquake.

Standard homeowners policies typically do not cover damage directly caused by earthquakes (or floods), though they do cover some secondary damage resulting from earthquakes – a fire resulting from a gas line ruptured during a quake, for example. Protecting against damage directly caused by earthquakes requires adding a rider to your homeowners policy.

2. We don’t need earthquake insurance in Rhode Island or on Massachusetts’ SouthCoast.

The Connecticut quakes may have straightened some folks out on this one. On the other hand, the fact that the quakes were small and caused only minor damage may have emboldened some into believing that New England is invulnerable to the magnitude of earthquake more commonly associated with the West Coast.

In fact, the region averages about six earthquakes measuring 2.0 or higher on the Richter Scale, and, experts say, due to significantly different geological conditions, seismic waves generally travel farther on the East Coast than on the West Coast. This means a 4.5-magnitude earthquake here could do the damage of a 5.5-magnitude quake there. Since 2000, five earthquakes with an epicenter in Massachusetts have registered 2.5 or higher, including a 3.0 emanating from Harwich on Cape Cod in 2002 and a 2.5 from Plymouth in 2005.

According to the Earthquake.com website, southern New England alone has experienced 10 earthquakes measuring between 1.5 and 2.5 in magnitude in the past five years. Among those were a 2.3-magnitude quake off Charlestown, RI, in March of last year and a 2.0 quake centered about 2.5 miles southeast of Newport this past December. Days after the latter temblor, a 2.1-magnitude struck Plymouth, MA.

The most powerful recorded earthquake in Massachusetts history, estimated at between 6.0 and 6.3 on the Richter scale, emanated off Cape Ann of the North Shore in 1755, damaged about 1,500 buildings in colonial Boston and causing tremors reported in locations as distant as Nova Scotia and South Carolina. Suffice to say, damage from a quake of that magnitude today would cause considerably more damage.

It may be a few more centuries before an earthquake of that magnitude hits the area, but earthquakes aren’t predictable. Connecticut officials were concerned enough after the January 2015 quake that they held a meeting including representatives from FEMA, the Red Cross and the local United Way, and followed up with a public forum to share the results of that meeting.

3. Earthquake insurance is expensive.

Depending the age and location of the home, its construction materials and whether your homeowners policy includes an open-peril endorsement, Massachusetts and Rhode Island earthquake insurance typically ranges from about 23 to 36 cents per $1,000 of coverage on the home, excluding deductible. Most deductibles are 5 percent of the dwelling coverage amount, though some companies offer a lower-deductible/higher-premium option.

“Expensive” is a relative word, but considering the damage an earthquake could do to your home, you may determine that earthquake insurance is a bargain.

To learn more about Massachusetts and Rhode Island earthquake insurance, contact a Sylvia Group agent.

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By JOHN BEAUREGARD
Senior Partner, Sylvia Group


About John Beauregard and Sylvia Group

During more than three decades as a business insurance professional in Massachusetts and Rhode Island, John Beauregard has built relationships with clients by recognizing and addressing their unique risks and needs, providing them with the best available coverage and delivering dedicated, dependable customer service, particularly in the property development and management, medical manufacturing, municipal, education, and transportation insurance markets. A member of Sylvia Group since 1989, John was named Executive Vice President in 2008 and became a Senior Partner in 2017. As a Certified Insurance Counselor (CIC) and Licensed Insurance Adviser (LIA), he works with clients to help them secure what they’ve invested in and built, evaluating the risks they face, developing customized policies to protect against those risks and creating comprehensive risk-management programs designed to save them money by reducing premiums.

Sylvia Group uses SPS – the Sylvia Protection System – to empower businesses and individuals with performance-based insurancebenefits and financial planning programs. SPS makes our clients active participants in managing risk and containing premiums, resulting in coverage that is both customized and cost-effective. In addition to making a difference for our clients, we make a difference for our community as a whole by actively supporting and serving many of southern New England’s most reputable and effective nonprofit organizations and institutions. Sylvia Group became an Alera Group company at the outset of 2020, enabling us to combine the local, personal service for which we’re known with the scope and resources of a national firm.

 

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