Can You Deduct Earthquake Insurance Premiums? Coverage and Limits Explained

At around 2:00 a.m. on August 23, 2026, an earthquake centered in southern Ibaraki Prefecture registered a maximum intensity of 5-lower in Ibaraki, Saitama, Chiba and Tokyo. Our thoughts are with those who were injured. The Japan Meteorological Agency has advised that shaking of similar intensity remains possible for roughly a week.

After a night like that, many homeowners ask whether they should have taken out earthquake insurance. Rather than comparing products, this article looks at how the premiums you pay are treated for tax purposes: how the earthquake insurance premium deduction is calculated, which homes qualify, and the exclusions that overseas owners and landlords most often overlook.

Can Earthquake Insurance Be Bought on Its Own?

Earthquake insurance in Japan operates under the Act on Earthquake Insurance, jointly run by the government and private insurers. It covers loss caused by earthquakes, volcanic eruptions and resulting tsunami. In practice it generally cannot be purchased standalone and is attached as a rider to a fire insurance policy.

The sum insured is generally set within a range of 30 to 50 percent of the fire insurance sum insured, subject to caps commonly cited as 50 million yen for a residential building and 10 million yen for household contents. Because the framework is set by statute, coverage and premium levels tend not to differ greatly between insurers.

How Much Can You Actually Deduct?

Premiums paid may qualify as an income deduction for both national income tax and local resident tax. For income tax, the full amount is generally deductible where annual premiums are 50,000 yen or less, with a flat 50,000 yen treated as the ceiling above that. Resident tax uses a different formula, generally around one half of the premiums paid, up to 25,000 yen.

Note that this is an income deduction that reduces taxable income, not a tax credit subtracted directly from tax due. The actual saving therefore depends on your marginal rate, and the ceiling is not the amount refunded.

Do Premiums on a Rental Property Qualify?

The deduction generally applies to policies covering a dwelling owned by you, or by a spouse or relative sharing your household finances, that is used as a permanent residence, together with household goods such as furniture, fixtures and clothing that are ordinarily necessary for daily life.

That means premiums on a rental apartment where the owner does not live, on a holiday home not used as a permanent residence, or on a vacant property are generally outside the scope of the deduction. Where a home includes a shop or office, only the portion corresponding to residential use qualifies; where residential use accounts for roughly 90 percent or more of the whole, the full premium may be treated as eligible.

What About Policies Written Before 2007?

The earthquake insurance premium deduction began with the 2007 tax year, and transitional treatment applies to older casualty insurance. A contract concluded on or before December 31, 2006 that provides maturity refunds, runs for ten years or more, and has not been amended on or after January 1, 2007 may be treated as a former long-term casualty insurance premium and calculated as follows.

For resident tax, the ceiling on this transitional deduction is generally cited as 10,000 yen. Where you have both earthquake insurance premiums and former long-term premiums, the combined ceilings are 50,000 yen for income tax and 25,000 yen for resident tax; where a single policy involves both, you generally elect one or the other rather than claiming both.

Year-End Adjustment or Tax Return?

Salaried employees usually claim the deduction through the year-end adjustment by entering it on the insurance premium deduction declaration submitted to their employer. If it was not claimed there, or if you file a return because you have rental or other income, you claim it on your tax return instead.

In either case you will be asked to attach or present the earthquake insurance premium deduction certificate issued by your insurer. Certificates are typically mailed in the autumn and reissuing one takes time, so it is worth deciding where to keep it the moment it arrives.

In the SUMIMOTO Hub app, a 24-hour AI adviser explains in multiple languages how to read a policy schedule and a deduction certificate, and where owner-occupied and rental properties are treated differently. For the content of an actual filing and for residency determinations, we recommend confirming with a qualified professional such as a tax accountant.