{
  "slug": "earthquake-deductible-cost",
  "title": "Earthquake Insurance Deductible Cost Calculator",
  "heading": "Earthquake Deductible Cost Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/earthquake-deductible-cost",
  "summary": "See your actual out-of-pocket cost under an earthquake policy's percentage deductible.",
  "description": "Earthquake insurance deductibles work differently from most other insurance: instead of a flat dollar amount, they're typically 5%, 10%, 15%, or 20% of your dwelling's insured value, not of the claim size. That structure catches people off guard — a $500,000 home with a 15% deductible means you pay the first $75,000 of any earthquake damage yourself, regardless of whether the loss is $80,000 or $400,000. This calculator converts your deductible percentage into a real dollar figure, applies it against an estimated damage scenario, and shows what the insurer actually pays versus what comes out of your pocket, so you can weight the deductible tradeoff against the premium savings a higher percentage typically buys.",
  "formula": "Deductible amount = dwelling coverage × deductible %; insurer payout = max(0, estimated damage − deductible amount), capped at dwelling coverage.",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=earthquake-deductible-cost",
  "inputs": [
    {
      "id": "dwellingCoverage",
      "label": "Dwelling coverage amount",
      "kind": "number",
      "hint": null,
      "default": 500000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "deductiblePct",
      "label": "Deductible percentage",
      "kind": "number",
      "hint": null,
      "default": 15,
      "unit": "%",
      "min": 5,
      "max": 25
    },
    {
      "id": "estimatedDamage",
      "label": "Estimated damage scenario",
      "kind": "number",
      "hint": null,
      "default": 150000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "annualPremium",
      "label": "Annual premium at this deductible",
      "kind": "number",
      "hint": null,
      "default": 1200,
      "unit": "$",
      "min": 0,
      "max": null
    }
  ],
  "outputs": [
    {
      "id": "deductibleAmount",
      "label": "Your dollar deductible",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "outOfPocket",
      "label": "Your total out-of-pocket on this scenario",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "insurerPayout",
      "label": "Insurer payout on this scenario",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "yearsOfPremiumEqualToDeductible",
      "label": "Years of premium equal to deductible",
      "format": "decimal",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Dwelling coverage amount: 500000 $",
      "Deductible percentage: 15 %",
      "Estimated damage scenario: 150000 $",
      "Annual premium at this deductible: 1200 $"
    ],
    "outputs": [
      "Your dollar deductible: $75,000",
      "Your total out-of-pocket on this scenario: $75,000",
      "Insurer payout on this scenario: $75,000",
      "Years of premium equal to deductible: 62.5"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter dwelling coverage amount ($).",
      "Enter deductible percentage (%).",
      "Enter estimated damage scenario ($).",
      "Enter annual premium at this deductible ($).",
      "Read your your dollar deductible on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "dwellingCoverage": 300000,
        "deductiblePct": 10,
        "estimatedDamage": 90000,
        "annualPremium": 700
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "dwellingCoverage": 500000,
        "deductiblePct": 15,
        "estimatedDamage": 150000,
        "annualPremium": 1200
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "dwellingCoverage": 800000,
        "deductiblePct": 25,
        "estimatedDamage": 240000,
        "annualPremium": 1900
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "Why is the earthquake deductible based on coverage value, not the claim amount?",
      "a": "Insurers use a percentage-of-coverage deductible because earthquake losses are catastrophic and correlated — many policyholders file at once after a major quake, so insurers need a predictable, large self-retention per policyholder rather than a small flat amount. It also discourages small claims for cosmetic cracking, keeping the pool focused on structural damage."
    },
    {
      "q": "Does a higher deductible always save money?",
      "a": "Generally yes on premium, often meaningfully — moving from 10% to 20% can cut premium 20-40% depending on the insurer and region. But run the math on your actual savings capacity: if a 20% deductible on a $500k home means $100,000 out of pocket and you don't have that liquid, the premium savings isn't worth the exposure."
    },
    {
      "q": "Does earthquake insurance cover contents and loss of use separately?",
      "a": "Yes, most policies have separate deductibles or sub-limits for contents (personal property) and additional living expenses if your home is uninhabitable, often not subject to the same large percentage deductible as the dwelling. Read your policy's declarations page carefully since contents deductibles are sometimes a flat dollar amount instead."
    },
    {
      "q": "Is earthquake insurance required by mortgage lenders?",
      "a": "No, standard mortgage requirements only mandate flood insurance in designated flood zones, not earthquake coverage, since earthquake risk isn't federally mapped the same way. It's entirely optional even in high-seismic states like California, which is why take-up rates in California hover around 10-15% of homeowners despite significant fault exposure."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/flood-zone-premium-estimate",
    "https://www.revenuelab.fyi/toolbox/renters-coverage-sizing"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Earthquake Insurance Deductible Cost Calculator (https://www.revenuelab.fyi/toolbox/earthquake-deductible-cost)"
}