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Why so few houses have earthquake insurance near Missouri’s New Madrid Seismic Zone

020422_US Geological Survey_Oklahoma earthquake 2011.jpg
Brian Sherrod
U.S. Geological Survey
Bricks tumble off a damaged home in central Oklahoma after a magnitude 5.6 earthquake hit in 2011. Residents in southeastern Missouri and the St. Louis area could expect to see similar damage if the New Madrid Seismic Zone sparks a major earthquake.

Missouri state officials say residents in the New Madrid Seismic Zone, which stretches along the eastern part of the state, are largely unprepared for the next major earthquake.

Earthquake insurance coverage in the highest risk area has fallen to historic lows in recent years.

Only about 12% of homes in the six-county region near the southeastern tip of Missouri have earthquake insurance, a dramatic decline compared to 2000, when about 60% of homes had coverage. Meanwhile, insurance costs have skyrocketed by 760% during that time, according to a report by the Missouri Department of Commerce and Insurance.

Carrie Couch, director of the department’s consumer affairs division, said the cost of earthquake insurance is high because there aren’t enough people buying the coverage.

“I don’t think they understand that the coverage has to be purchased separate from your homeowners or renters policy,” she said. “It’s been a while since there’s been an earthquake of any significance, so it’s not in the forefront of folks’ minds. They’re thinking about other things right now, like COVID.”

Couch said another issue is that not all insurers offer earthquake coverage. The department has a guide on its website to help residents find appropriate coverage in their area. The cost can depend on a home’s location and building material. For example, brick veneer, which is common in St. Louis, is not always covered.

This map of Missouri shows the percent of residential policies with earthquake coverage in 2020. Homes in the southeastern part of the state are at the highest risk of an earthquake, yet few have insurance for it.
Missouri Department of Commerce and Insurance
This map of Missouri shows the percentage of residential insurance policies that had earthquake coverage in 2020. Homes in the southeastern part of the state are at the highest risk of an earthquake, yet few have insurance for it.

If a major earthquake occurs along the New Madrid Seismic Zone, researchers say it could result in the nation’s costliest natural disaster — causing an estimated $300 billion in total damage, according to a joint assessment by the Mid-America Earthquake Center at the University of Illinois and the Federal Emergency Management Agency.

The seismic zone in Missouri, Arkansas and parts of Tennessee and Kentucky experienced three powerful earthquakes with an estimated magnitude of 7 to 7.5 in the winter of 1811 and 1812. The earthquakes and aftershocks caused damage to riverbanks and sparked flooding and landslides.

Sarah Russell, the commissioner of emergency management for the City of St. Louis, said having insurance is just one way to prepare for a possible earthquake. They recommend residents practice what they’d do in the event of an earthquake and equip themselves with common things they’d need for any emergency situation.

“We always encourage people to take three steps: Make a plan, build an emergency kit and have ways of staying informed,” Russell said.

Russell is also encouraging residents to make sure heavy furniture like bookshelves are strapped to the wall and that lighting fixtures are securely fastened.

Follow Corinne on Twitter: @corinnesusan

Corinne is the economic development reporter at St. Louis Public Radio.

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