Earthquake Insurance in California: CEA Policies, Deductibles and Retrofit Grants

By Matthew Martinez, Founder, CEO & Managing Broker, Diamond Real Estate Group. California DRE #01869679.

A standard California homeowners policy generally does not cover earthquake damage, so earthquake coverage is a separate policy. Most homeowners buy it from the California Earthquake Authority (CEA) through their own home insurer. CEA deductibles range from 5% to 25% of the dwelling limit. A mortgage lender requires homeowners insurance but, according to the California Department of Insurance, does not require you to buy earthquake insurance.

This guide covers why quakes are excluded, how CEA policies are built, how deductibles work, the retrofit grant and premium discount, and what to sort out during escrow.

Why homeowners policies exclude earthquakes

The California Department of Insurance earthquake guide (October 2024) explains the basics:

Earthquake damage is generally excluded from standard homeowners policies.
Fire after an earthquake is covered. California law requires homeowners and renters policies to cover fire caused by or following an earthquake, whether or not you carry earthquake insurance.
Some related losses may be covered, such as explosion, theft or broken glass, depending on the policy. Ask your agent.
Your insurer must offer earthquake coverage. The insurer must put the offer in writing, with limits, deductible and estimated premium, and repeat it every other year. You have 30 days from the mailing date to accept. If you don’t respond, the offer is treated as rejected.

The CDI guide adds that the CEA provides most earthquake insurance in California. You can’t buy a CEA policy directly. You buy it from a CEA participating insurer, and only if that same company writes your residential policy. Standalone earthquake policies from private insurers are also available and don’t require a homeowners policy from the same company.

How a CEA homeowners policy is built

The CEA sells two homeowners structures. Standard Homeowners bundles every coverage under one deductible. Homeowners Choice sets separate deductibles for the dwelling and personal property, and allows dwelling-only coverage (CEA coverages and deductibles).

Coverage	What it pays for	Limit options listed by CEA	Deductible
A & B: Dwelling and extensions	The house and attached structures, such as an attached garage	Must match the Coverage A limit on your homeowners policy	5%, 10%, 15%, 20% or 25% of the Coverage A & B limit
C: Personal property	Furniture, appliances, clothing and other contents; $500 included for some breakables	$5,000 or $25,000	Standard: Coverage A deductible must be met first. Choice: optional, with its own 5%–25% deductible, waived if the Coverage A deductible is met
D: Loss of use	Added living costs when the home can’t be safely occupied	$1,500, $10,000, $15,000, $25,000, $50,000, $75,000 or $100,000	None
Emergency repairs	Steps to prevent further damage, such as boarding windows	First $1,500 has no deductible; more is paid after the deductible, up to 5% of the applicable limit	First $1,500 none
Building code upgrades	Bringing the home up to codes in effect on the date of loss	$10,000 included; $20,000 or $30,000 available	Paid once dwelling damage exceeds the Coverage A & B deductible

CEA’s current homeowners coverage table lists personal-property limit options of $5,000 or $25,000. Review that limit separately from dwelling coverage and loss-of-use coverage. An older policy or an earlier quote may have different options, so compare the actual current policy form, exclusions and insurer quote. CEA says homeowners can add earthquake coverage without waiting for their homeowners policy renewal.

How the deductible works

The CEA deductible is a percentage of the dwelling limit, not of the damage. For example, with an $800,000 Coverage A limit and a 15% deductible, the deductible is $120,000. Dwelling damage below that amount is yours to pay. The figures are hypothetical.

Not every home can choose every deductible. Per the CEA, the 5% and 10% options are unavailable when the Coverage A limit is over $1,000,000. They are also unavailable for pre-1980 frame houses not on a slab foundation unless the retrofit is verified. Those homes choose 15%, 20% or 25%. The CDI guide notes that state law only requires insurers to offer a 15% deductible.

A lower deductible generally means a higher premium. Use the CEA premium calculator or your agent’s quote to compare options on the same house.

Retrofit grants and premium discounts

Earthquake Brace + Bolt (EBB). The California Residential Mitigation Program’s EBB page describes grants of up to $3,000 toward a code-compliant retrofit. The work bolts the house to its foundation and braces cripple walls with plywood or OSB. CRMP gives typical retrofit costs of $3,000 to $7,000. Key terms as posted:

Eligible homes: Wood-frame houses built before 1980 on a raised foundation. Cripple walls of 4 feet or less need a brace-and-bolt retrofit. Frames sitting directly on a stem wall need bolting only.
Location: Offered in more than 1,100 high-hazard ZIP codes as of January 15, 2025. Check the program’s ZIP list.
Supplemental grant: Income-eligible households (income of $94,480 or less, per the page) can receive up to $7,000 more, which may cover up to 100% of the cost, first-come, first-served.
Registration: Open for a limited time each year. Contractors must come from CRMP’s directory, or you can do the work as an owner-builder. The water heater must be strapped, and chimney work isn’t covered.

CRMP says the program is funded by the CEA’s Loss Mitigation Fund and FEMA’s Hazard Mitigation Grant Program. Registration windows, ZIP lists and income limits are updated, so confirm on the CRMP site before planning around a grant.

CEA premium discount. The CEA offers premium discounts of up to 25% for older houses that have been properly retrofitted. A verified retrofit can also open up the lower deductible options for pre-1980 raised-foundation homes.

Property tax. A qualifying seismic retrofit can be excluded from new-construction reassessment if you notify the assessor and file on time. Sacramento County’s assessor lists notice before completion or within 30 days after, and form BOE-64. Owners of soft-story apartment buildings should see our multifamily seismic retrofit guide.

Do lenders require earthquake insurance?

The CDI guide says a mortgage requires homeowners insurance, but you are not required to buy earthquake insurance. Fannie Mae’s property insurance requirements for 1–4 unit properties (Selling Guide B7-3-02, dated 08/05/2026) list the required perils: fire or lightning, explosion, windstorm, hail, smoke, aircraft, vehicles, and riot or civil commotion. Earthquake is not on that list.

Individual lenders, loan programs, commercial or multifamily loans, and condo associations can set their own requirements. Read your loan commitment and, for a condo, the association’s master policy and CC&Rs. Our loan contingency guide covers how insurance conditions fit into loan approval.

Fitting earthquake coverage into escrow

Check the hazard picture early. The Natural Hazard Disclosure statement shows whether the property is in an earthquake fault zone or seismic hazard zone. See our NHD report guide and earthquake fault zones guide.
Find out the foundation type and year built. Those two facts drive deductible eligibility and EBB eligibility. Ask whether a past retrofit has permits or a certificate.
Quote homeowners and earthquake together. A CEA policy requires a homeowners policy from a participating insurer. If your dwelling coverage comes from a non-participating company or from the California FAIR Plan, ask about standalone earthquake options. Our guide to homeowners insurance during escrow covers timing.
Decide on the deductible with cash in mind. Compare the deductible amount in dollars with your reserves.

If you’re buying a pre-1980 house in San Francisco, Marin County or elsewhere in the Bay Area, confirm the foundation type in the inspection report before choosing a deductible. To start a search, see Buy with Diamond.

Questions people ask

Does homeowners insurance cover earthquakes in California?

Generally no. Earthquake damage is excluded from standard homeowners policies, but California law requires coverage for fire caused by or following an earthquake.

Who sells CEA earthquake insurance?

CEA participating insurers sell it. You must have your residential policy with a participating insurer and buy the CEA policy from that same company.

What deductibles does the CEA offer?

5%, 10%, 15%, 20% or 25% of the dwelling limit. Homes with a dwelling limit over $1,000,000, and pre-1980 raised-foundation frame homes without a verified retrofit, are limited to 15%, 20% or 25%.

Is loss of use subject to the deductible?

No. CEA states that Coverage D, loss of use, has no deductible. Limits range from $1,500 to $100,000 depending on what you choose.

Does my lender require earthquake insurance?

The CDI says a mortgage doesn’t require it, and Fannie Mae’s list of required perils for 1–4 unit homes doesn’t include earthquake. Your lender, loan program or condo association may still set its own terms, so check your loan documents.

How much is the Brace + Bolt grant?

Up to $3,000 toward a qualifying retrofit, with a supplemental grant of up to $7,000 for income-eligible households, according to CRMP. Funding and registration are limited each year.

Can I buy earthquake insurance after closing?

Yes. CEA says you can add a policy at any time without waiting for your homeowners policy to renew.

Sources & notes

California Department of Insurance: Earthquake insurance guide (October 2024): exclusion, fire-following coverage, offer rules, lender note, CEA participating insurers.
California Earthquake Authority: Homeowners policies: coverage parts, deductible options and limits, retrofit discount.
California Earthquake Authority: Coverage options and deductibles for homeowners: Standard vs. Choice, coverage limit options.
California Residential Mitigation Program: Earthquake Brace + Bolt: grant amounts, eligibility, ZIP codes, contractor rules.
Fannie Mae Selling Guide B7-3-02: Property insurance requirements for one- to four-unit properties: required perils.
Sacramento County Assessor: New construction exclusions: seismic retrofit exclusion filing.

Coverage options, discounts and grant terms change; check the current figures with the CEA, CRMP and your insurer. This page does not quote premiums.

General information, not legal, tax or lending advice. Updated November 2026. Primary sources are linked in this guide.

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