A separate decision across the West.

A full-margin magnitude 9 Cascadia Subduction Zone earthquake carries a 10 percent chance in the next 50 years on a time-independent model, or 15 percent on a time-dependent model that accounts for the last great Cascadia earthquake in 1700. In the Puget Sound region, a damaging deep intraslab earthquake of magnitude 6.5 or greater sits at about 85 percent over the same 50 years. Source: USGS Fact Sheet 2025-3050, published September 2025.

Where it matters, and why lenders raise it

The USGS seismic model shows meaningful exposure well beyond California, into Oregon, Washington, Utah, Nevada, and parts of Idaho and Montana. On financed property, lenders may require an earthquake workup or coverage depending on the collateral and the investor standards, and in California a seismic assessment is commonly part of a sale or loan. Owners in Washington and Oregon often find the gap only at acquisition or refinance, because earthquake is not in the standard form.

The percentage deductible, and the income side

Earthquake policies typically apply a deductible as a percentage of the insured value, which on a commercial building can be a large number before the policy pays. Depending on the wording, coverage may also extend to business personal property and some income loss. The deductible and the period of restoration together decide how much of a seismic loss you still carry, so they are the details that matter most before buying.

The form, and why the edition depends on your state

Earthquake is not in a standard commercial property policy. The exclusion being bought back is CP 10 30 09 17, B.1.b Earth Movement, which rules out earthquake including tremors and aftershocks and any related earth sinking, rising or shifting. Coverage comes back by endorsement, or on a separate policy, or on a difference-in-conditions form from a specialty market.

Here is the part almost no page will tell you. On the ISO route, the filed edition is not the same across the states we write, and the difference is not cosmetic.

In Arizona, Colorado, New Mexico, Nevada, Oregon and Utah, the current forms are the 02 19 family: CP 10 40 02 19, Earthquake And Volcanic Eruption Coverage With Percentage Deductible, and CP 10 45 02 19, the sub-limit version. That filing also made a flat-dollar deductible option available through CP 10 28 02 19 and CP 10 29 02 19.

In California, Idaho, Montana, Texas and Washington, the forms are still the 10 12 edition, titled Earthquake And Volcanic Eruption Endorsement, and the flat-dollar deductible forms are not on the list at all. If you own buildings on both sides of that line, you can be looking at two different forms for the same peril in the same portfolio.

The four combinations worth knowing are percentage deductible or flat dollar, each in a full-limit or a sub-limit version. A sub-limit form insures earthquake for less than your full building limit, which is a real decision and not a detail.

One caution on deductibles. The percentage itself is set in your declarations, not printed in the form, so no page can tell you what yours is. What matters is that it applies to the coverage limit rather than to the size of your loss. On a $10 million building, the gap between 5% and 15% is a million dollars of your own money, which dwarfs any premium difference between two quotes.

There is no published commercial earthquake take-up rate for any state. Insurance departments that publish take-up data publish residential only, so treat any commercial figure you see elsewhere with suspicion.

How we handle it

We weigh the building's location and construction against the seismic exposure, model what the percentage deductible would actually cost, and check whether a standalone earthquake policy or a difference-in-conditions structure fits the building and the rest of the program, including any lender requirement.