Two earthquakes struck northern B.C. and the Yukon Monday morning causing power outages as well as damaging buildings enough to close both a school and an office building through Tuesday.
B.C. is at the latter end of a ‘slow slip’ period, the equivalent of an earthquake season, where tectonic plates shift into interlocking position every 14 months creating several tiny tremours and heightening the risk of a major earthquake. However, despite the period reaching its conclusion, Donna Ince, RSA’s vice president of personal lines, said a catastrophe could occur unexpectedly and indeed there is no method for predicting earthquakes.
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“While there have not been any major casualties from today’s seismic events, the reality is that a natural disaster could strike any time, without warning,” Ince said. “Given that those in B.C. and the Northern territories – among other regions - live in a seismically active area, earthquake occurrence in the near future is guaranteed.”
According to Ince, homeowners are likely to turn to their brokers seeking compensation for losses “even if the coverage if not provided by their contracts.”
“As such, brokers should offer EQ coverage on every new policy sold,” she said. “They should also consider writing to every existing client with a homeowner, tenant, condo or commercial building policy. In their correspondence, brokers should consider explaining the risk and offering to add earthquake coverage to the policy. When weighed against potential catastrophic loss, a small addition to their monthly premium can seem pretty appealing.”
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“Earthquake insurance is not included in a standard home insurance policy, but it can be purchased as an add-on and typically is subject to a higher deductible,” she added. “For example, if an earthquake was to cause a gas main to break and ignite a fire, only the resulting loss or damage from the fire would be covered under the base home insurance policy, not damage related to the earthquake.”
In the case of this week’s rumbles, the power outages and office closures were the worst losses and even those are potentially insurable.
“Loss of power can lead to an interruption of business and where this loss of power is caused by an insured peril there are insurance options,” explained Ince. “Business interruption insurance typically responds to loss or damage to insured property at the location specified on the policy, but there are extensions available which provide coverage for extended periods of lost power caused by damage to off premises utilities by an insured peril.”
There are 4,000 quakes on record in Canada every year according the International Red Cross.
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