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Apr 18, 2008 6:51 pm US/Central
Chicagoans Weigh Earthquake Insurance
CHICAGO (CBS) ―
Illinois sits on a seismically active area, and as we learned Friday earthquakes are a real possibility. One way some homeowners are protecting their property is with earthquake insurance.
CBS 2's Susan Carlson reports a standard homeowner's insurance policy in the Chicago area does not cover any damage that would result from an earthquake. Some people considered Friday morning's wake-up jolt a wake-up call to tweak their policies.
"When something like this comes up, we get some calls and they feel the urgency," said State Farm insurance agent Gary Behrends. "But then it soon goes away."
Behrends says Chicago is considered an earthquake zone because of the New Madrid fault downstate. Still, the risk is low and only about 1 percent of his customers have purchased additional coverage to protect them in the event of a quake.
"I do have a few customers who have it and their thinking is, it doesn't cost very much. Let's just have it," Behrends said.
On a $300,000 home, it would cost about $100 a year with a 5 percent deductible.
"Earthquake insurance can be added to any homeowner's policy as an endorsement for protection against that loss," said Liberty Mutual agent Todd Souto.
CBS 2 checked with four different agencies. They all offered similar riders for quake coverage in the Chicago area, at comparable rates.
"You should always weigh the risks and rewards of endorsements. It depends on your risk tolerance whether you should get this coverage," Souto said.
"It's something I should probably think about given this morning," said Chicago resident Alan Gehr.
But others disagree.
"I think insurance is overkill here in Chicago," said Chicago resident Rich Peterson.
"If it happens again or more frequently I might think about it, but when was the last time we had an earthquake?" said Aquelah Davis.
The answer to that question is 2004, when an earthquake hit Utica about 60 miles west of Chicago. It measured a 4.2.
Before that, in 1985, there was a smaller earthquake in DuPage County.
As for Chicago proper, one of the largest earthquakes in U.S. history caused extensive damage here in the city, but that was back in the early 1800s.
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