12/14/2004

Advice from Nashville's leading Financial Aid Advisor Dave Ramsey

 
Dave Says
By Dave Ramsey
Author of:
Financial Peace and
The Total Money Makeover

Should I buy earthquake insurance?

Dear Dave,

It’s time for me to renew my homeowner’s insurance. I’ve always had earthquake insurance on my policy. Is it a good idea for me to renew this? Supposedly, we’re living on a fault line.

Teresa in Salt Lake City, UT



Dear Teresa,

I’m confused. I don’t remember ever reading about an earthquake in Salt Lake City. Supposedly, there’s a fault near Memphis, TN that’s going to crack and swallow up everything. However, there’s only been one time recorded that there’s been any activity there. Based on that premise, insurance people went through selling earthquake insurance too. 

No. I wouldn’t buy it. If you lived in California, where they have earthquakes all the time, that would be a different matter. However, in Salt Lake City there just isn’t the same level of threat of damage. If I lived in Salt Lake City, I wouldn’t buy earthquake insurance.

Dave

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