Understanding Hurricane Insurance Coverage

Hurricane Irene

With peak hurricane season upon us, it’s time to pull out your homeowners insurance policy to check if you have a hurricane or windstorm deductible, and make sure you understand how it works in the event you have to file an insurance claim.

While standard homeowners deductibles for fire, theft and other disasters listed in the policy are usually a dollar amount, hurricane and wind deductibles are generally calculated as a percentage and typically vary from 1 to 5 percent of a home’s insured value. So, if a home is insured for $300,000 and the policy on the structure has a 5 percent deductible, the first $15,000 of a claim must be paid by the policyholder.

Windvane Hurricane

There are two kinds of wind damage deductibles: windstorm deductibles, which apply to any kind of wind damage and hurricane deductibles, which are only triggered when certain criteria are met (e.g., after the National Weather Service (NWS) has determined a Category 1 storm made landfall). If you live on the coast, you may have the option of paying a higher premium in return for a lower deductible depending on how close to the shore your residence is situated. In high-risk coastal areas, insurers often require the inclusion of a hurricane or wind deductible before selling a homeowners insurance policy. According to a spokesperson for the Insurance Information Institute “Everyone, no matter where they live, should make sure they understand what is and is not covered under their home insurance policy, as well as how their deductibles work.

And remember water damaged caused by storm surge is NOT covered by hurricane insurance; a separate Flood Insurance policy is necessary to cover most types of water damage. Flood insurance policies can take up to thirty days from the date of purchase to the first covered date; plan ahead!

Call us to discuss your homeowner’s policy deductibles, hurricane and flood coverage today. We’re always here to help at 401/846-9629.

Some Article Content Courtesy: The Insurance Information Institute, www.iii.org
Additional information: National Association of Professional Insurance Agents, www.pianet.com