Preparing for Disaster: Earthquake Insurance for your Home or Business

Marci • March 19, 2013

Preparing for disaster:  earthquake insurance for your home or business

 

With the devastating financial toll of the Feb 2011 earthquake in New Zealand predicted to reach $16-billion, many people in British Columbia are considering whether they should insure their homes and business against losses due to earthquakes.  And with good reason.

 

According to the Geological Survey of Canada, there is approximately a 10% chance that a subduction (oceanic plate) earthquake – similar in force as the catastrophic earthquake that killed over 300,000 people in the Southeast Asia – will occur off the coast of BC in the next 50 years.

 

There is a 12% chance that a crustal or shallow earthquake – similar to the Christchurch earthquake – would strike Vancouver in the next 50 years.  This type of earthquake could easily cause over $30-billion of structural damage to the city

 

Why should I have earthquake insurance?

 

A Habitat Insurance, we believe that the main objective of insurance is to protect you from a devastating loss from which you would find it difficult to financially recover.  A home or business is usually the most valuable asset that you will ever own.  So you must ask yourself,  “Could I easily recover without financial assistance if my home or business were damaged or destroyed by an earthquake?”  If the answer is no, you should seriously consider buying earthquake coverage.

 

Facts about earthquake insurance in BC

 

Earthquake insurance provides coverage for loss of or damage to personal property and buildings. It is optional coverage in all property insurance policies.

 

Earthquake rates are on the rise:  during the last 12 months, we have noted that many insurance companies have increased their premium rates and, with large losses such as those in New Zealand, this is a trend likely to continue.

 

If you own a detached home and have earthquake insurance, you will have coverage for the building and a certain percentage of coverage will be “built in” to the policy for personal property.  For example, a house valued at $500,000 replacement cost will be insured at $500,000 building cost with 80% ($400,000) for personal property.  (Depending on the insurance company, lower limits for personal property can be chosen. )

 

Insurance deductibles are always higher for losses due to earthquake.  Your house insurance or business policy may state $500 to $2,500 deductible for specific perils such as water damage.  Earthquake deductibles are typically stated as a percentage of the total loss.  So, if you have a 5% deductible on your $500,000 home, you will be responsible to pay the first $25,000.

 

A special note for condo owners about earthquake insurance

 

A condo owner policy provides coverage for your personal property, not the building.  (The building should have its own separate strata policy with earthquake coverage. )  You may also choose to add earthquake coverage to your condo policy.  We highly recommend that you do this, as your policy will can provide up to about $25,000for building earthquake deductibles coverage.

 

To illustrate the point more clearly, imagine this scenario:  your building is damaged/destroyed by an earthquake.  The condo owners will be responsible for paying the building earthquake insurance deductible.  A large strata building can be easily valued at $20,000,000; a total loss with a 10% deductible would result in a $2,000,000 earthquake deductible to pay.  If there is not enough money in the strata’s reserve fund, the remainder of the deductible to be paid will be divided between all of the condo owners.  If you have a condo owner’s policy with earthquake coverage, your insurance company will pay your portion of the deductible, up to the indicated policy limit.  If you don’t have earthquake coverage, your policy will likely pay no part of the earthquake deductible.

 

Condo policy limits can vary substantially for insurance deductible coverage.  Check with your broker about this important point.

 

How to pay less for earthquake coverage

 

Here are a few ways to reduce your premiums for earthquake coverage:

 

Location:   Premium rates for earthquake insurance in the Lower Mainland are highest for areas such as Richmond and parts of New Westminster, which would likely be most devastated by an earthquake.  You will pay lower rates elsewhere.

 

Deductible:   Ask for a higher earthquake deductible on your insurance policy.  For example, the standard earthquake deductible on your business or house insurance policy may be 5%.  You could opt instead for a 10% deductible.  Keep in mind that your deductible payment will also be much higher in the event of an earthquake claim.

 

Choose a lower personal property limit:   If you are home owner, some insurance companies will allow full value coverage for the building and a lower limit for personal property.  Ask your broker if this option is available.

 

 

 

If you have any questions about earthquake insurance for your home or business in British Columbia, or you would like a quote, please contact us:

 

Habitat Insurance Agencies, Ltd

 

Grace Catao – Managing Partner

 

Tel. 604-438-5241 / Cell 778-997-2583

 

Copyright © Habitat Insurance Agencies Ltd.   All rights reserved.

 

Disclaimer:  This article is designed to provide information for personal use only.  Please consult your professional insurance broker for further information. Habitat Insurance Agencies Ltd is not responsible for any legal disputes of this matter.

 

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What Older Canadians Should Know About Mortgage Financing

By Marci Deane • August 26, 2026
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What Online Mortgage Calculators Can—and Can’t—Tell You

By Marci Deane • August 19, 2026
What Online Mortgage Calculators Can—and Can’t—Tell You Online mortgage calculators are everywhere—and on the surface, they seem like a no-brainer. You plug in some numbers, and out pops what you can “afford.” Simple, right? Not quite. While the math itself is correct, the story behind those numbers is often misleading. Mortgage qualification isn’t just about numbers—it’s about context, risk, and lender policy. And that’s where calculators fall short. The Numbers Are Accurate—but the Picture Isn’t An online calculator can show you what a payment might look like at a given interest rate, or how making extra payments could reduce your amortization. That’s useful information! But when it comes to mortgage qualification , calculators don’t account for the many variables that lenders consider, such as: Your credit history and score Employment type (salary, self-employed, contract) Outstanding debts and monthly obligations Assets, savings, and down payment source The property type and location you’re buying Lenders evaluate all these factors through their internal risk models. That means two people entering the exact same numbers into a calculator could receive very different results when they actually apply for a mortgage. Why Online Calculators Can Mislead You When you see a “How much can I afford?” or “Mortgage Qualification” calculator online, it’s easy to treat the result as fact. But these tools don’t know your financial story—they only crunch the data you enter. A calculator can’t predict how a lender views your risk, how new mortgage rules apply to your file, or how things like spousal support, car loans, or variable income will impact approval. In short: calculators estimate payments, not qualification . Use Calculators the Right Way Don’t get us wrong—online calculators still have value. Use them to explore different “what-if” scenarios: How do payments change with different down payment amounts? How would a rate increase affect affordability? What if you added $100 a month to your payments? These tools are great for helping you understand your comfort zone. Just remember: they’re a starting point, not a green light. The Real First Step: Get a Pre-Approval If you’re serious about buying a home, skip the guesswork and get a mortgage pre-approval . It’s quick, free, and gives you real-world clarity on what you can afford. A pre-approval looks at your full financial picture—income, credit, debts, assets—and provides a framework for your purchase price, payment range, and rate options. It’s the only way to get a reliable answer to the question, “What can I really afford?” Final Thoughts Online calculators are convenient, but they can’t replace expert advice. Think of them as a starting point, not a solution. A professional mortgage broker can interpret the numbers, navigate lender policies, and tailor your financing strategy to your actual situation. If you’d like help understanding your true buying power—or want to get pre-approved with confidence— reach out anytime . I’d be happy to walk you through your options and help you make sense of the numbers.

Going Through a Divorce? Don’t Let Your Credit Take the Hit

By Marci Deane • August 12, 2026
Going Through a Divorce? Don’t Let Your Credit Take the Hit Divorce is stressful enough without adding financial fallout to the mix. Between lawyers, paperwork, and emotional strain, it’s easy to overlook how a separation can impact your credit. But your financial future depends on protecting it now—because long after the dust settles, a damaged credit score can linger. Here are a few smart steps to help keep your credit strong and your finances steady as you move forward. 1. Take Control of Joint Debts When it comes to joint debt, both parties are equally responsible—no matter what your divorce agreement says. If your ex misses a payment on an account with your name attached, your credit takes the hit too. Go through all joint credit cards, loans, and lines of credit. Wherever possible: Close joint accounts to stop future shared use. Transfer balances to the person responsible for repayment. Notify lenders in writing of any changes to account ownership. Once everything is updated, pull your credit report after three to six months to confirm all joint accounts have been closed and reporting correctly. Mistakes happen—stay proactive to prevent surprises later. 2. Open Your Own Bank Accounts Separation means financial independence, and that starts with your own banking. Open a new chequing account in your name only and redirect your pay deposits and bill payments there. At the same time, close any joint bank accounts and change passwords on existing online banking and credit profiles. Even in peaceful separations, shared access can cause confusion—or conflict. Protect yourself by ensuring your money and information are secure. 3. Start Building Credit in Your Name If most of your past credit was tied to your spouse’s name, now’s the time to establish your own. Apply for a small personal credit card or secured credit product . Use it sparingly and pay it off in full each month. This helps you build a solid individual credit history, setting the stage for future goals like buying a home, refinancing, or starting fresh financially. 4. Keep an Eye on Your Credit Monitor your credit report regularly for errors or unexpected changes. You can request free reports from both major credit bureaus in Canada— Equifax and TransUnion —once a year. Tracking your credit isn’t just about catching mistakes; it helps you see your progress as you rebuild your financial independence. Final Thoughts Divorce can be emotionally draining, but protecting your credit doesn’t have to be complicated. By taking a few careful steps now—closing joint accounts, building credit in your name, and monitoring your reports—you’ll safeguard your financial health and gain peace of mind as you start your next chapter. If you’d like personalized guidance on managing credit during or after a divorce, reach out anytime. I’d be happy to walk you through your options.