Sample Paper on Seismic insurance coverage for homeowners and businesses

It would be rational for homeowners and businesses in known earthquake hazard zones to be required to purchase and maintain seismic insurance coverage for their buildings. This is because while they are living or operating in known earthquake hazard zones, they must be informed that there is a 100% surety that more earthquakes will occur in the future. It is also notable that the danger of living in such areas is based on the understanding that earthquakes of higher magnitudes are more likely to occur in the future since they are common occurrences. By purchasing and maintaining seismic insurance coverage for their buildings, homeowners and businesses will be instituting effective protection mechanisms for their property in case of an earthquake which is bound to occur with or without the insurance coverage.

A requirement for purchasing and maintaining a seismic insurance coverage should also be based on the understanding that the homes or businesses may be located on or near a fault line. This makes such homes and businesses at a higher risk of being affected by and earthquakes hence making an investment in seismic insurance coverage one of the most viable options. Inasmuch as the cost of purchasing and maintaining a seismic insurance coverage may be relatively expensive for those with homes or businesses on or near fault lines, the overall cost may be relatively low considering that in case of devastating damage to property, the insurance coverage will be responsible for the costs incurred in the reconstruction process. Furthermore, it will also provide an opportunity for expanding their coverage and protection considering that most insurance policies do not cover structural damages and broken personal property.