Earthquake

An earthquake policy has the simplest index of the six and the hardest conversation about distance. We draw a circle around the insured location, 41 kilometres by default, and the policy answers one question: did a shallow event of at least a given magnitude start inside it? Magnitude is moment magnitude, the number agencies publish after the first hours of analysis, not the first automatic estimate that is often revised.

The three tiers are Mw 5.8 (25 % of the limit), Mw 6.4 (50 %) and Mw 7.1 (the full limit). The depth rule, shallower than 70 kilometres, keeps deep events that shake broadly and weakly out of the index. If a quake falls in between, say Mw 6.2, you receive the tier below it and the settlement note shows the next one so the ladder stays readable.

Two networks have to agree. The calculation agent takes the magnitude from the public catalogue and from a second regional array, and signs when they are within 0.3 of each other. When they are not, the policy waits for the catalogue’s reviewed solution and pays on that, usually within a few hours. A later revision of the magnitude does not reverse a payment that was made on a reviewed value.

Prevention for earthquakes is mostly about the first minutes, so the policy sends an early notice when a regional network publishes a shaking forecast for your cell, and keeps a checklist for the hours after: gas valves, rack power, evacuation counts. It cannot predict a quake. It can shorten the time between the shaking and the first person who knows about it.