A recent survey by Square One reveals that 56 percent of Canadians wrongly believe the government will cover earthquake damage
August 26, 2014
(Vancouver, BC): According to Natural Resources Canada, there were 195 earthquakes across Canada between August 1 and 25. While most of these earthquakes occurred in the West Coast, 18 percent occurred elsewhere in Canada. Of the seven earthquakes that were felt during this time period, five were in Central Canada, one was in the Prairie Provinces, and only one was in the West Coast.
“According to our recent survey, virtually all Canadians correctly assume that earthquakes can occur anywhere in the country,” states Daniel Mirkovic, president of Vancouver-based Square One. “But, a majority wrongly believes the government will provide financial assistance for earthquake damage.”
Square One used Google Consumer Surveys to ask Canadians four earthquake-related questions. A total of 593 people completed the survey between August 18 and 25. The survey revealed that:
- 90 percent recognize that earthquakes can occur anywhere in Canada.
- 56 percent believe the government will provide financial assistance to homeowners and renters for earthquake damage.
- 30 percent are unaware that earthquake protection is automatically included in, or can be added to, home insurance policies.
- 46 percent have little confidence that home insurance companies would be able to pay covered claims resulting from a major earthquake.
Mirkovic indicates, “There are some misconceptions that need to be addressed. For starters, the government will not provide financial assistance to cover damages from earthquakes.” The provincial and territorial disaster financial assistance programs only cover damages due to uninsurable events, like overland flooding and groundwater seepage. Since earthquake damage is insurable, homeowners and renters are not eligible for assistance under the government programs.
Canadians should speak with their home insurance providers about earthquake protection. A few policies automatically include this protection, but most require that it be specifically added. The cost of earthquake insurance depends on the limit and deductible selected, as well as the home’s location. Estimates from across the country for earthquake insurance on a $300,000 house and its contents are:
- $15 in Toronto, ON
- $25 in Winnipeg, MB
- $178 in Montreal, QC
- $284 in Edmonton, AB
- $213 in Halifax, NS
- $332 in Vancouver, BC
- $515 in Richmond, BC
While earthquake insurance can be pricey for those who own houses, Square One recommends it always be purchased on primary residences. It’s simply not worth the risk of going without earthquake insurance. For those renting their homes, or living in apartments or condos, earthquake insurance usually ranges from $5 to $50 per year.
Many who don’t buy earthquake protection have little to no confidence that home insurance companies will be able to pay covered claims resulting from a major event. The reality is that numerous earthquakes and other disasters occur around the world each year. Insurance companies factor earthquakes into their prices, building reserves to pay for resulting claims. Some of the other things that help ensure insurance companies are able to meet their commitments:
- Insurance companies buy catastrophe protection from reinsurance companies. This helps spread the risk (and cost) of disasters globally.
- Insurance companies are heavily regulated by both provincial and federal governments. Among other things, these governmental bodies supervise the solvency of companies.
- Insurance companies must be members of the Property and Casualty Insurance Compensation Corporation (PACICC). If an insurance company fails, PACICC will automatically respond to all valid claims for participating members. PACICC is similar to the Canadian Deposit Insurance Corporation, which protects savings in case a bank fails.
Square One recommends that all Canadians should take steps to prepare for an earthquake. Exploring earthquake insurance options should be one of those steps. To learn more about earthquake insurance, talk with an insurance provider or visit www.squareoneinsurance.ca/home/earthquake.
Established in 2011 and based in Vancouver, British Columbia, Square One offers the only home insurance policy in Canada that can be personalized to your unique needs. That means you only pay for the protection you need. Square One is also one of the few providers to automatically include earthquake, water backup and broad water protection in its policies. Square One currently serves British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. For more information about Square One, or to get an online quote, visit www.squareoneinsurance.ca.
For more information on this release, please contact:
Square One Insurance Services Inc.
Tel: 1.855.331.6933 ext 101