Few Americans have invested in earthquake insurance despite the enormous damage earthquakes can cause, according to ratings agency AM Best.

The report includes details of earthquakes that have caused the greatest damage in the US, including the California quake of 1994 that resulted in almost $US18 billion ($24 billion) of insured property losses.

The report says the great San Francisco earthquake and fire of 1906 would mean more than $US29 billion ($39 billion) in insured losses today.

Yet AM Best estimates that only 10-15% of US homeowners have earthquake insurance. And in earthquake-prone California, only 12% of 2005 residential insurance packages and 11% of commercial insurance packages included earthquake cover.

AM Best business analyst and report co-author John Williams notes that the number of people and companies carrying earthquake cover is low.

He says the most likely reason is cost, but sometimes there’s a high deductible and people wonder if it is worth doing. And there could also be caps on cover.

However, many people assume they don’t live in an area at risk. “The fact is, there’s earthquake risk in most areas of the country,” Mr Williams said.

The cost of not having earthquake cover could be extremely high. The study found, for example, that a huge earthquake in the Los Angeles area could result in nearly $US550 billion ($733 billion) in property losses, of which just $US101 billion ($135 billion) may be reimbursed by insurance companies at current participation rates.