Fire and earthquake insurance for homeowners
Mortgage requirements, building and contents, exclusions, and earthquake limits.
Lenders generally require adequate fire insurance; earthquake insurance must be attached to fire insurance, is generally 30–50% of the fire amount (capped at ¥50 million building / ¥10 million contents), and is recovery-oriented — ordinary fire insurance does not cover earthquake-caused fire.
Key points
- Lenders generally require adequate fire insurance on the building.
- Earthquake insurance must be attached to fire insurance and is capped.
- Earthquake cover is generally 30–50% of the fire amount (¥50M building / ¥10M contents).
- Ordinary fire insurance does not cover earthquake-caused fire.
Fire insurance and the lender requirement
Lenders generally require adequate fire insurance on the building as a condition of the mortgage, because the building is their collateral. Fire insurance covers building and contents against specified perils, but read the exclusions carefully — notably, ordinary fire insurance generally does not cover earthquake-caused fire. You can often buy through the lender or an agent, but compare external quotes and commissions where permitted, since a bundled policy is not automatically the cheapest or best-fitting cover.
Earthquake insurance and its limits
Earthquake insurance must be attached to fire insurance — you cannot buy it standalone. Its insured amount is generally 30–50% of the corresponding fire-insurance amount, capped at ¥50 million for the building and ¥10 million for household contents, and it is designed to support recovery rather than guarantee complete reconstruction. So it will not rebuild your entire home; it helps you restart. A condominium owner should consider cover for the unit and contents while checking the association’s cover for common elements. In an earthquake-prone country, the separate earthquake cover is worth serious consideration despite its caps.
Key points to carry away: Lenders generally require adequate fire insurance on the building; Earthquake insurance must be attached to fire insurance and is capped; Earthquake cover is generally 30–50% of the fire amount (¥50M building / ¥10M contents); Ordinary fire insurance does not cover earthquake-caused fire. Use the linked guides and calculators for the full decision, and confirm anything material with the lender, a licensed broker, a judicial scrivener, or a tax accountant before you act.
Who this is for
- New homeowners arranging insurance
- Condominium owners checking coverage
What this is not
- A specific policy recommendation
- Ordinary fire insurance does not cover earthquake-caused fire; earthquake cover is separate and capped.
Frequently asked questions
Is fire insurance mandatory?
Lenders generally require adequate building cover as a condition of the mortgage.
Does fire insurance cover earthquake fire?
Ordinary fire insurance generally does not; earthquake insurance is needed.
Does earthquake insurance rebuild the entire home?
Not necessarily; insured amounts are capped (¥50M building / ¥10M contents) and recovery-oriented.
Should a condominium owner buy earthquake insurance?
Consider cover for the unit and contents while checking the association’s cover for common elements.
Can insurance be bundled with the lender?
Yes, but compare external quotes and commissions where permitted.