First an earthquake, then a hurricane . . . What does my insurance cover?


Did Maryland’s recent natural disasters leave you wondering whether you have the right insurance to protect your home in the event of earthquake and hurricane damage? Bel Air News & View sponsor Chip Schilling of Northern Chesapeake Insurance Services shares his research on these topics and offers tips on the types of insurance coverage you might want to consider during this hurricane season. For more information, contact him at 410-420-3080 or

First an Earthquake, then a Hurricane…

What does my insurance cover??!!

Two natural disasters in one week! It was one of the most unusual weeks that Marylanders have ever experienced. The aftermath of these uncommon events made for a very busy week for insurance agents. Many clients had questions regarding what would be covered from both the earthquake and hurricane. Clients also wanted to know if there were specific coverage options that they should consider moving forward from these occurrences. Coverage concerns regarding hurricanes will continue to be of particular interest because hurricane season doesn’t end until November 30th.

Compared to the massive amount of news coverage and public concern, damage from the earthquake on August 23rd was relatively minor. Most of the damages that were reported were small cracks in walls, chimneys, and sidewalks. Unfortunately, most people who experienced damage from the earthquake were surprised to learn that earthquake (“earth movement” in insurance language) damages are excluded from standard property insurance policies in Maryland. According to the Maryland Insurance Administration (MIA), the “earth movement” exclusion applies to any damage resulting from earthquake, landslide, mine subsidence, mudflow, and earth sinking/rising/shifting. As is often the case with many exclusions on insurance policies, consumers can opt to purchase an additional coverage rider for “earth movement” or earthquake damage from most insurance carriers. Generally speaking, an optional endorsement or rider for earthquake coverage costs between $100-$200/year and is subject to a deductible that can range from 5%-15% of your policy’s dwelling coverage limit. While the coverage is not terribly expensive, the deductible is often the strongest deterrent to consumers adding the coverage. For example, if your home’s structural dwelling coverage is $250,000 and the earthquake deductible is 5%, coverage would not apply until your damage exceeds $12,500! Because of these high deductibles, even folks who purchased earthquake coverage prior to this most recent event might not have been covered. Their loss would have probably been below their deductible. Check with your particular insurer regarding this coverage. Not all insurance companies will offer an earthquake or earth movement coverage option. Please note that if your company does offer this option, most companies will impose a waiting period (30 days) before allowing coverage to go into effect.

Unlike earthquake damage, hurricane damage to your home or its contents from the combination of high winds and heavy rains is generally covered by most homeowners policies in Maryland. However, there are certain exclusions or deductibles that can apply during a hurricane. For example, some insurers can institute a higher deductible for a “Named Storm” than your normal policy deductible. These can range anywhere from 1%-5% of your policy coverage. Another area of possible coverage limitation during a hurricane is water damage. A homeowner is generally covered for water damage to a home when wind first damages the roof or siding which ultimately results in water damage being a secondary occurrence to the initial wind damage.  However, most property insurance policies in Maryland exclude damage due to: flood; a backup of water through sewer or drain lines; water seepage or leakage through a crack in your home’s foundation.

The Maryland Insurance Administration, in a press release from May of 2011 for National Hurricane Preparedness Week, defines flood as “a general and temporary condition where two or more acres of normally dry land or two or more properties are inundated by water or mudlow”. The MIA continues, “Many conditions can result in a flood: hurricanes, broken levees, outdated or clogged drainage systems, water main breaks, and rapid accumulation of rainfall”. Unlike with earthquake coverage, you can’t just add an optional rider to a property insurance policy to cover flood. Flood insurance is a separate policy offered through the federal government’s National Flood Insurance Program (NFIP) and is available for purchase through most local insurance agencies.  If you are in a high-hazard flood risk area, the average flood insurance premium is around $500/year. However, if you are in a low-risk area like a residential neighborhood away from rivers and tidal water, you can purchase a Preferred Risk Policy that starts at just $122 a year. Similar to earthquake coverage, the NFIP imposes a mandatory 30-day waiting period before a new flood policy can go into effect.  A water and/or sewer backup loss is different than a flood. A water and/or sewer backup loss is generally defined as a backup of water through any sewer or drain lines in your home. The most common example of this type of loss is an overflow from the sump pump. If your sump pump is not working because the electricity is out or the pump has malfunctioned, the resulting water damage to your home and contents is not covered without having purchased a separate rider for this type of loss.  Water and/or sewer backup coverage can be added with a simple rider to most homeowners insurance policies. The cost for this coverage is generally between $25-$100, depending on the amount of coverage selected. Unfortunately, there are no additional riders or coverage options available for water seepage or leaking through a crack in your home’s foundation. The Maryland Insurance Administration addresses this issue in their consumer pamphlet titled “Weather Related Damage”.  The MIA states, “Problems from seepage are considered maintenance issues and are not covered by insurance”.

If you would like additional information about this or any other insurance related topic, please contact me at my office. My phone number is 410-420-3080 and my email is . Also, please visit the Maryland Insurance Administration website at . At the MIA website, you can find some of the information that I referenced here as well as their consumer reference materials such as their “Insurance Preparedness Guide for Natural Disasters” and “Weather Related Damage – Frequently Asked Questions About Insurance Coverage.” Or you can reach the MIA by phone at 800-492-6116.


Contact Chip at:

Northern Chesapeake Insurance Services

134 Archer Street
Bel Air, MD 21014
Fax 410-420-3080

General email:
Chip’s email:

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