“We learn geology the morning after the earthquake.” ~Ralph Waldo Emerson, American essayist, poet, and lecturer (1803-1882)

Only a year ago, on August 23, 2011, an earthquake centered in Virginia was felt by millions of Americans living in states along the East coast.

Many Tennesseans assume that their home and business insurance automatically covers damage from earthquakes. They are wrong.

This column focuses on the fact that automatic coverage for earthquake damage has been dropped from many standard insurance policies in Tennessee.

One reason is that insurance companies are more aggressively analyzing their general risks after major losses such as those from Hurricane Katrina in 2005. Another reason is that insurance companies are analyzing their specific potential risks in the event of a future major earthquake in or near the New Madrid fault. This earthquake zone was named for a destroyed Louisiana Territory settlement and trading community along the Mississippi River, in what is now southeastern Missouri.

Q. What is the significance of the “New Madrid” fault?

Students of history and geology recently noted the 200-year anniversary of the “New Madrid” earthquakes. These four large earthquakes in the winter of 1811-1812 – along with hundreds of aftershocks – devastated large sections of Missouri, Arkansas, and Tennessee. Massive slippage of earth along fault lines dammed up rivers and created lakes, including Reelfoot Lake.

The mighty Mississippi River appeared to flow backward in places. Church bells were shaken into ringing as far away as Boston, Massachusetts, with sidewalks cracked and broken in Washington, D.C.

The New Madrid fault runs for 120 miles along and across parts of five state lines (Illinois, Kentucky, Missouri, Arkansas, and Tennessee). There are 15 to 20 minor, un-felt, tremors a month in the fault area. Major earthquakes causing serious damage have been limited to once every few hundred years (900 A.D., the mid 1400’s, and 1811-1812). This means that there is a possibility that another major, damaging earthquake in the New Madrid fault area could happen anytime during the next few hundred years.

Q. Is my home or business covered for damage caused by earthquakes?

Probably not – unless you have purchased a separate, additional insurance policy often called a “rider.”  

Several large insurance companies that write insurance policy contracts in Tennessee have been quietly deleting earthquake coverage from standard homeowner and business insurance contracts during annual policy renewals in the past few years.

Q. How can I know whether earthquake damage has been dropped from my insurance coverage?

Insurance companies are required to inform policy holders of changes to insurance in advance. Many consumers, however, do not carefully read these notices.

As they phase out earthquake and ground movement coverage from policies, some insurance companies are requiring customers to sign an acknowledgement that earthquake insurance is being deleted from their standard policies.

It is a good idea to ask your insurance agent whether you have such coverage.

Q. How can I obtain insurance coverage for earthquake damage?

Ask your insurance agent or company whether you can buy additional coverage for property damage from earthquakes and ground movement. Make sure that you know whether the “rider” will cover both structural damage and damages to personal property (possessions).

EXTRA CONSUMER TIP: On July 6, 2012, President Obama signed legislation which extends the National Flood Insurance Program’s authority through September 30, 2017. If you need federal flood insurance – which is not provided in standard insurance policies – you may wish to visit the official NFIP website at FloodSmart.gov.

James B. (Jim) Hawkins is a general practice and public interest law attorney based in Gallatin. This column represents legal information, and is not intended to take the place of legal advice.  All cases are different and need individual attention.  Consult with a private attorney of your choice to review the facts and law specific to your case.  To suggest future column topics, call (615) 452-9200.