Disaster Relief Programs
Federal Disaster Relief Program
Disaster Relief Program of the American Red Cross
The emergency management center of the American Red Cross offers immediate emergency relief andassistance with housing needs and shelter operations prior to the Presidential declaration of a federal
disaster. Emergency response includes:
Federal Disaster Relief Program
 | You may wrongly believe that the United States Government will take care of all your financial | |
| needs if your home is damaged and suffer losses in an earthquake which is not true! In fact, the federal disaster relief programs are designed to help you get partly back on your feet but not to replace everything you lose. | ||
| The federal disaster assistance is only available after the US President signs a major disaster | |
| declaration. Once issued, the Federal Emergency Management Agency (FEMA) in cooperation with other agencies such as the Small Business Administration (SBA) may activate a disaster relief program, namely “Assistance for Individuals and Households Program.” | ||
| The primary form of federal disaster relief is low-interest loans to eligible individuals, | |
| homeowners and businesses made available through the SBA to repair or replace damaged property and personal possessions not covered by insurance. SBA loans are up to $40,000 for damage to personal-property and $200,000 for damage to real-estate property. | ||
| FEMA disaster grants for emergency home repairs and temporary rental assistance are only | |
| available to individuals and households who do not qualify for the SBA loans. These grants include: |
 | Home repair cash up to $26,200 (average grant is less than $15,000) which would not be | |
| enough to repair a damaged home. | ||
| Short-term housing assistance reimbursement for lodging expenses at a hotel or motel. | |
| Long-term rental assistance in the form of cash payments for up to 18 months to rent a unit | |
| while repairing your home. | ||
| If no other housing is available, FEMA may provide mobile homes or other temporary housing. |
| The Farm Service Agency (FSA) offers loans to assist agricultural businesses. |
Disaster Relief Program of the American Red Cross
The emergency management center of the American Red Cross offers immediate emergency relief and
disaster. Emergency response includes:
| Opening and operating emergency shelters. | |
| Providing blood, emergency food, emergency drinking water, baby supplies, and blankets. | |
| Providing basic health needs including mental health. | |
| Helping with limited financial assistance for disaster recovery. | |
| Earthquake Awareness and Preparedness |
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Your Assets and Investments are at Risk
If you own your home, it is your biggest financial asset. Your home and investments made in home
contents and personal possessions may be at risk from earthquakes because it is likely that you will have
some level of nonstructural and/or structural damage especially if you live within 30 miles of an active
major fault lines such as San Andreas Fault or Hayward Fault in California, or the New Madrid Fault in the
Midwest. In addition, tsunamis generated by earthquakes-induced movements of the Pacific Ocean floor
may cause flooding or damage if your home is located in tsunami-risk area near the West Coast.
If you own your home, it is your biggest financial asset. Your home and investments made in home
contents and personal possessions may be at risk from earthquakes because it is likely that you will have
some level of nonstructural and/or structural damage especially if you live within 30 miles of an active
major fault lines such as San Andreas Fault or Hayward Fault in California, or the New Madrid Fault in the
Midwest. In addition, tsunamis generated by earthquakes-induced movements of the Pacific Ocean floor
may cause flooding or damage if your home is located in tsunami-risk area near the West Coast.
Homeowners Insurance
Homeowners insurance does not cover earthquake damage to the structure of your home, its
contents, and your personal possessions. Loss or damage from flooding due to tsunamis that
may be generated by earthquake movement of the ocean floor (such as the mega tsunami that
followed the 2011 Japan Earthquake) is only covered under a stand-alone tsunami insurance or
flood insurance that specifically include losses due to tsunamis. Moreover, earthquake damage
to your vehicles is only covered if you purchase a comprehensive auto insurance policy.
However, coverage for other kinds of damage that may result from earthquakes, such as fire
and water damage due to burst gas and water pipes, is provided by standard homeowners
insurance.
Homeowners insurance does not cover earthquake damage to the structure of your home, its
contents, and your personal possessions. Loss or damage from flooding due to tsunamis that
may be generated by earthquake movement of the ocean floor (such as the mega tsunami that
followed the 2011 Japan Earthquake) is only covered under a stand-alone tsunami insurance or
flood insurance that specifically include losses due to tsunamis. Moreover, earthquake damage
to your vehicles is only covered if you purchase a comprehensive auto insurance policy.
However, coverage for other kinds of damage that may result from earthquakes, such as fire
and water damage due to burst gas and water pipes, is provided by standard homeowners
insurance.
Your Personal Finance after an Earthquake
Homeowners insurance (including the special form HO3 which
is the most comprehensive policy for single-family homes that
provides all-risk coverage) excludes earthquakes and
tsunamis; while the federal disaster relief programs have
eligibility requirements and have limited dollar value that may
not be enough to fix a damaged home. Therefore, you will
out-of-pocket almost the full cost of repairing the home
structure and replacing its damaged contents, and will
continue making mortgage payments while also paying the
cost of living elsewhere while the home is being repaired. You
will still be responsible for any existing personal debt such as
auto loans and credit card payments.
Homeowners insurance (including the special form HO3 which
is the most comprehensive policy for single-family homes that
provides all-risk coverage) excludes earthquakes and
tsunamis; while the federal disaster relief programs have
eligibility requirements and have limited dollar value that may
not be enough to fix a damaged home. Therefore, you will
out-of-pocket almost the full cost of repairing the home
structure and replacing its damaged contents, and will
continue making mortgage payments while also paying the
cost of living elsewhere while the home is being repaired. You
will still be responsible for any existing personal debt such as
auto loans and credit card payments.
How to protect your Assets and Investments from the costs of
Destructive Earthquakes?
Recent earthquakes and tsunamis around the globe are reminders for people living in active
seismic zones to prepare! Earthquake preparedness in such areas would require seismic
retrofit the structural system of the home and risk mitigation of the nonstructural components
and home contents in order to ensure home safety and reduce injuries. Earthquake insurance
is an effective option in reducing the potential costs of inevitable future earthquakes. Flood
insurance would also be effective for people living near the coast in tsunami-risk areas.
Destructive Earthquakes?
Recent earthquakes and tsunamis around the globe are reminders for people living in active
seismic zones to prepare! Earthquake preparedness in such areas would require seismic
retrofit the structural system of the home and risk mitigation of the nonstructural components
and home contents in order to ensure home safety and reduce injuries. Earthquake insurance
is an effective option in reducing the potential costs of inevitable future earthquakes. Flood
insurance would also be effective for people living near the coast in tsunami-risk areas.