Agent Advises Washington Homeowners
Recently, we reached out to McClain Insurance’s earthquake specialist, Dova Smith. She provided some interesting insights into selling earthquake insurance in her market. The Washington State-based agency sees homeowners looking for the security that an earthquake policy can give in this seismic area.
Dova shared that there are always opportunities to further educate clients about the risks and preparation for an event. The agency uses direct mail and word of mouth to generate interest in Earthquake coverage. The McClain team is ready to answer insured questions about why they need it and how much they need, plus details on limits, loss of use, deductibles, and disaster planning.
Do Homeowners Need Earthquake Insurance in Washington?
Dova emphasized that homeowners make the mistake of “not taking advantage of the option of purchasing extra coverages” when deciding on their insurance needs. Areas along the West Coast truly feel the threat when an earthquake hits but often underestimate the damage that could be caused by the “Big One.” The Washington State Department of Natural Resources predicts that “Large earthquakes are likely to happen in Washington during your lifetime. Most of the populated areas of the state have a 40–80% chance of having an earthquake in the next 50 years.”
Offering GeoVera Earthquake insurance provides the agency with Errors and Omissions protection. To protect your business, you should require clients who decline Earthquake coverage to read and sign GeoVera’s Earthquake Insurance Declination Acknowledgement. Homeowners may decline coverage, but agents should remainWhat is a Good Deductible for Earthquake Insurance?
One element of Earthquake insurance that is often misunderstood is the deductible. In fact, Dova told us that the client’s perception of “high deductibles” is the most common objection she receives when offering a new policy. The best way to explain how the Earthquake deductible works is that “it is subtracted as long as damage exceeds it, [and is] not required out of pocket up front.” If they submit a claim, the amount paid to the client will be the loss amount minus the chosen deductible. Dova finds that “this explanation is very good at helping clients feel better about choosing a higher deductible.”
GeoVera offers a wide range of deductibles in its products, ranging from 2.5% to 25%, and we make it easy to see quotes for all deductibles. The appropriate deductible can vary and is influenced by the client’s financial position and risk tolerance.
How Does Loss of Use Coverage Help Clients after an Earthquake?
The Loss of Use coverage is key when writing an Earthquake policy. For Washington policyholders, GeoVera pays additional living expenses for housing and living expenses if the home is uninhabitable. It also pays fairrental value if the home that is rented to others becomes uninhabitable. Keep in mind that after a large-scale event, contractors will be in high demand while entire neighborhoods recover, and the time your client is kept from their home could be longer than expected. For that scenario, Insureds are encouraged to increase their Loss of Use limit.
How can we all be prepared for an event?
- Dova has some standard advice for her clients: “Have sturdy shoes near your bed, have an earthquake kit for you and your pets, include meds and cash in the kit, and have a good water supply.” Find out more in this blog.
- In the home, water heaters, gas fixtures, and other utilities should be anchored and fitted with flexible connectors to prevent breaks and leaks. Flammable or toxic substances, such as cleaning supplies or paint, should be stored in a secure, low area where they cannot spill and create additional hazards.
- Beyond the larger pieces of furniture, pay attention to smaller fixtures and electronics. Secure items like picture frames, mirrors, and lamps. Use cord organizers to prevent tripping over cables during an evacuation. Additionally, consider using safety film on windows to prevent shattering.
The GeoVera team hopes that your clients will not need us, but we are here to help impacted customers rebuild when an earthquake strikes. Information on how to file a claim, as well as additional preparedness information, can be found on the GeoVera website. Insurance agents play a critical role in advising clients about adequate insurance protection, which in seismic regions should include coverage for earthquakes. Remind homeowners that safety is not just about reacting in the moment of crisis but about being prepared long before it arrives.
