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Earthquake Insurance
Practice questions on earthquake insurance for the property exam, each with an answer and explanation.
Study questions and answers
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1. Under a standard homeowners policy, earthquake damage to the dwelling is:
- Covered in full
- Excluded as earth movement, but an ensuing fire is covered
- Covered only for the contents
- Covered only if the earthquake lasts less than 72 hours
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B. Excluded as earth movement, but an ensuing fire is covered
Earth movement, including earthquake, is excluded. Direct loss from ensuing fire, explosion or glass breakage is covered.
Earth movement, including earthquake, is excluded. Direct loss from ensuing fire, explosion or glass breakage is covered.
2. Under a typical earthquake endorsement, all earthquake shocks occurring within what period are treated as a single earthquake?
- 72 hours
- 24 hours
- 7 days
- 30 days
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A. 72 hours
Shocks within a 72-hour period count as one earthquake, so only one deductible applies to them.
Shocks within a 72-hour period count as one earthquake, so only one deductible applies to them.
3. Earthquake coverage deductibles are most commonly expressed as:
- A flat $250
- A percentage of the premium
- A percentage of the coverage limit
- A waiting period in days
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C. A percentage of the coverage limit
Earthquake deductibles are usually a percentage of the dwelling or contents limit, which can mean a large out-of-pocket amount.
Earthquake deductibles are usually a percentage of the dwelling or contents limit, which can mean a large out-of-pocket amount.
4. A homeowner adds an earthquake endorsement to his policy. Unless the endorsement says otherwise, damage to the home's brick or stone veneer is generally:
- Covered in full
- Excluded
- Covered without a deductible
- Covered only under Coverage F
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B. Excluded
Earthquake endorsements commonly exclude masonry veneer unless the insured specifically adds that coverage.
Earthquake endorsements commonly exclude masonry veneer unless the insured specifically adds that coverage.
5. A home slides down a hill during a landslide unrelated to any flood or earthquake. Under an unendorsed homeowners policy, this loss is:
- Excluded as earth movement
- Covered as collapse
- Covered as windstorm
- Covered under Coverage D only
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A. Excluded as earth movement
Earth movement, including landslide, mudslide, sinkhole and earthquake, is excluded from Section I of the homeowners policy.
Earth movement, including landslide, mudslide, sinkhole and earthquake, is excluded from Section I of the homeowners policy.