I live in the PNW, we don't have earthquake insurance, and we did retrofit our home and take some other precautions. BUT in your case, I'm not sure I'd drop it, because 1) it's cheap 2) it's not a standalone earthquake policy and 3) you can never go back
Our concerns were the high cost of premiums for us, and concern that a large earthquake would wipe out the insurance company as well. The other big thing, and this one I can't tell from your original post, is the deductible. Some insurance companies have a $50,000 to $100,000 deductible so we decided that it's a lot to pay to then be paying such a huge amount anyway.
Our neighbors have earthquake insurance that costs more than yours and feel it's money well spent for the peace of mind.