The Dominican Republic’s exposure to major earthquakes has come back into focus following powerful seismic events in neighboring Venezuela, prompting experts to warn that the vast majority of Dominican households remain financially vulnerable to a similar disaster.
According to Miguel Villamán, a consultant for the Superintendency of Insurance (SIS), only between 4.5% and 5% of the country’s occupied homes carry voluntary earthquake insurance. With an estimated 3.7 million occupied residences nationwide, that means roughly 170,000 properties have this type of protection, leaving more than 95% without dedicated coverage.
Mortgage Insurance Often Does Not Fully Protect Homeowners
Villamán cautioned that many homeowners mistakenly believe the insurance linked to a mortgage fully protects their property. In many cases, however, the policy primarily safeguards the lender by covering only the outstanding loan balance rather than the home’s full replacement value.
Franklin Glass, executive president of the Dominican Chamber of Insurers and Reinsurers (Cadoar), echoed that concern, explaining that many borrowers misunderstand the scope of mortgage-related insurance. If a home is completely destroyed by an earthquake, the remaining value of the property may not be covered once the outstanding debt has been paid.
Linda Sánchez, vice president for General Risks at Seguros Reservas, emphasized that insurance should be viewed as a financial recovery tool rather than a substitute for safe construction. While structural prevention reduces risk, insurance provides families with the financial resources needed to repair, rebuild or purchase another home after a catastrophic event.
Insurance Industry Has Capacity, but Household Coverage Remains Low
Data from the Superintendency of Insurance show that the Fire and Allied Lines segment, which includes earthquake coverage, generated RD$40.34 billion in written premiums during 2025. Of that amount, approximately RD$29.38 billion was transferred to international reinsurers, while local insurers retained about RD$10.96 billion.
Villamán said the insurance industry’s financial capacity is not the primary concern. Instead, the greatest challenge is that most earthquake-related losses would fall directly on families and, ultimately, on the Dominican government because so few homes are insured.
He added that insurers rely on international reinsurance agreements and catastrophe risk programs that strengthen their ability to respond after a major seismic event.
Construction Quality Also Raises Concerns
Financial protection is only one part of the country’s earthquake preparedness. Geologist Osiris de León noted that the Dominican Republic sits along the boundary between the North American and Caribbean tectonic plates, making earthquakes an inherent geological risk.
He estimated that roughly 70% of buildings in the country were constructed informally without adequate soil studies, structural engineering or official approvals, increasing their vulnerability during strong earthquakes.
Among the areas considered especially susceptible because of soft soil conditions are Santo Domingo Norte, Santo Domingo Oeste, Santiago, much of the Cibao Valley, Puerto Plata, Nagua, Samaná and the Neiba (Enriquillo) Valley.
Civil engineer Melquis Martínez also warned that many residential projects are built using construction methods copied from previous developments without conducting the site-specific geotechnical studies needed to design safe foundations and structural systems.
Although he acknowledged that the Ministry of Housing and Buildings (MIVED) supervises larger developments, he said staffing limitations make it difficult to monitor every construction project across the country.
Cost Remains a Major Obstacle
Experts say affordability continues to discourage homeowners from purchasing earthquake insurance. Villamán estimates that comprehensive residential coverage typically costs between 0.57% and 0.65% of a home’s insured value each year. A property with a reconstruction cost of RD$3 million could therefore require annual premiums ranging from approximately RD$17,100 to RD$19,500, before taxes.
Economist and financial consultant Jesús Geraldo Martínez said actual premiums often range from 0.6% to 0.8% of the insured value. For apartments worth RD$4 million to RD$5 million, annual premiums may reach between RD$29,000 and RD$35,000, representing a significant financial burden for many Dominican households.
Martínez also pointed to limited risk awareness, concerns about insurance claims and the relatively infrequent occurrence of major earthquakes as factors contributing to low demand.
Calls for Greater Protection
Several specialists advocate tax incentives, targeted subsidies and public-private partnerships to expand earthquake insurance coverage. Proposed measures include tax deductions for homeowners, subsidies for lower-income families living in high-risk areas and the development of lower-cost parametric insurance products.
Jairo Zambrano, executive president of Reaseguradora Santo Domingo, also suggested that government-backed catastrophe protection mechanisms could help reduce premiums and make insurance more accessible.
Despite the insurance sector’s ability to transfer catastrophic risk through international reinsurance, experts agree that the country’s greatest vulnerability remains the limited number of households protected against earthquakes. Without broader coverage, millions of families could face devastating financial losses if a major seismic event strikes the Dominican Republic.