Earthquake Insurance – Is Your Business Ready For The Big One?
If you’ve lived for the past decade in British Columbia, Ontario or Québec, you’ve likely experienced at least a slight tremor or two. And, if you’re intrigued by the Hollywood disaster flick genre, you may plan to watch Dwayne Johnson deal with the tragic aftermath of a massive San Andreas earthquake.
Keeping current with news drives home how very real the potential is for any natural disaster to cause serious harm. Even a small earthquake can damage property, interrupt business and, in a worst-case scenario, harm people. Depending on where you live, an earthquake is a very real concern for many Canadians.
In fact, according to a 2013 comprehensive 344-page report commissioned by the Insurance Bureau of Canada (IBC), “…about 4,000 earthquakes are recorded in Canada each year. Most are small and not felt by humans. But some are large. In the past three centuries there have been at least 24 significant earthquakes that were widely felt in Canada.” 1
Many Canadians live on or near potentially shaky ground. In fact, IBC notes “according to government studies, there is a 30% chance in the next 50 years that an earthquake strong enough to cause significant damage will strike southwestern British Columbia – including Victoria and Vancouver.” 2
Earthquake Insurance – A Big Risk Solution?
The International Risk Management Institute (IRMI)’s notes that earthquake coverage is “typically excluded (along with other earth movement) from most basic property insurance policies, except ensuing fire. In most cases, earthquake coverage must be purchased by endorsement…” and is typically included in “…an all risks policy. Normally, the coverage provided is subject to a per occurrence sublimit, an annual aggregate limit and a separate deductible.” 3
Canadian business leaders should be aware that according to IBC, “earthquake coverage may be purchased separately as an add-on to your policy, and it is subject to a higher deductible than coverage for other perils.” 4
Sources: 1 Study of Impact and the Insurance and Economic Cost of a Major Earthquake in British Columbia and Ontario/Québec, pg 12, IBC 2, 4 IBC 3 IRMI San Andreas movie
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