Home Insurance – Earthquake, Flood and Flood Insurance (Natural Disasters)
With the increasing frequency of seismic events in our country, and with the difficulties that the State encounters on each occasion failing to ensure the reimbursement of all damages and / or taking years, due to unnecessary red tape, to intervene effectively leaving in the meantime without a home many citizens, it is increasingly easy to hear about Earthquake Insurance. So much so that it has been thought on more than one occasion to make it mandatory.
The guarantee dedicated to Earthquake and/or Floods and Floods (Catastrophic Events) can be purchased with a separate Policy or through an Appendix to the Home Policy.
But let’s see together which types of damage it covers and when this particular guarantee intervenes.
Let’s start first of all with the definition of the risk covered and to which one must be very careful since it could exclude or include the operativity of the guarantee.
After an earthquake, our house may fortunately remain unharmed from the point of view of “stability”, that is, it may not be “at risk of collapse”, but it may nevertheless suffer considerable damage, for example, to the partitions and/or systems serving the building, which must be repaired and which entail considerable expenses for the Insured.
Why this premise?
We make it because, fortunately, these are, in most cases, the most frequent damages and a definition of the risk covered which does not include them deserves particular reflection.
For example, in the case of appendices or extraordinary indemnities for natural calamities, we may find statements such as: “if the building, following the event certified by the competent Public Authority, is completely destroyed or suffers damage which compromises its stability…”.
That the event must be certified by the Public Authority is quite evident, nobody can invent an Earthquake, but that the insured building must suffer damage that compromises its stability is a “dangerous” statement.
Such a definition excludes, in practice, the most frequent damages.
That is to say, those to the partitions, to the installations serving the building, which do not compromise the stability of the building but are, however, a direct consequence of the earthquake. These damages, in this case, would not be liquidated. The policy would cover only in the event of structural damage, for example cracks in the load-bearing walls for which the house would be declared unfit for occupancy by the authorities.
Another important factor to consider is the sequence of seismic events. Usually in fact, in the description of the risk, the shocks recorded in the 72 hours following each event are considered part of the same Earthquake and therefore give rise to “a single claim”. This is a positive aspect since, since in most cases significant deductibles (or overdrafts) are foreseen, if each shock were considered as a single claim, we would never be indemnified. An Earthquake is almost always characterized by a sequence of close seismic events (or within 72 hours) and damages must be quantified only after the episodes are attenuated if not disappeared permanently.
This is to say that, among other things, it is essential to assess how the Policy defines the timing of the Earthquake Claim represented by a series of interspersed shocks (It is precisely the duration of this interval in hours or days that we must assess and compare).
A further aspect to be assessed could be the “period of deficiency”. The gap period is an interval of time after payment of the premium during which the cover is not operative.