If a Hurricane Hits, Do You Have the Right Coverage?

We are in the midst of hurricane season, which lasts all the way through November.  The peak of the season is approaching which usually lasts from mid-August through late October in the Atlantic region.  There is a lot to do to prepare for a hurricane in order to keep your family safe.  Ready.gov provides basic preparedness tips for your family and home along with a list of supplies for a basic disaster supply kit.  It is important to prepare your home and family long before a storm approaches.   In addition to stocking up on supplies, coming up with an evacuation plan, and retrofitting your home, it is extremely important you review your insurance coverage to make sure you know what you are covered for if a hurricane hits.  You never want to find out you aren’t covered for something, especially if the option of purchasing the coverage was available.If a hurricane hits, do you have the right coverage-

The two most common types of hurricane damage are wind and water.  Although most policies cover damage due to winds, not all policy forms do.  The most basic policy form only covers fire, lightening, and internal explosion.  Although you don’t come across policies that often that are written with only a basic form, they do exist.  If you currently have a policy that is written with just a basic form, you should contact your agent immediately to see if you can add coverage for windstorm.  In some states, windstorm coverage isn’t available and and must be purchased through a separate ryder on your policy or through a separate policy altogether.

Another very important thing to understand about your insurance coverage is the deductible that applies to windstorms and/or hurricanes.  In hurricane prone areas, most property insurance policies are subject to a separate windstorm and/or hurricane deductible.  This deductible is often a percentage of the dwelling limit and typically ranges from 1-5% but could be higher in some cases.  For example, if your home is insured for $250,000 and has a 5% hurricane deductible you would be responsible for the first $12,500 of hurricane damage before the insurance company even starts providing coverage.  The more your home is insured for and the higher the % your deductible is, the more money you are responsible for out of pocket.  One of our primary carriers, Erie Insurance, does not have a separate windstorm/hurricane deductible in New York which is  very beneficial to it’s policyholders, especially those located in hurricane prone areas.  If your policy does not have a separate deductible listed any damage from a storm would most likely just be subject to the policy deductible.  I advise you confirm what deductible you are responsible for when it comes to windstorm/hurricane damage so you can prepare and budget accordingly or shop for policies that don’t require these separate windstorm/hurricane deductibles.

As I mentioned above, the other type of damage that most typically results after a hurricane is water damage.  This could include damage due to anything from flooding, mudslide, to sewer backup.  Water damage is a very gray area on most insurance policies with many exclusions.  For example, most property insurance policies do not cover flooding, mudslide, or sewer backup.  In some instances, additional endorsements can be purchased to cover some of these items.  For example sewer and drain backup is usually available for an additional premium.  Flood coverage on the other hand is typically only available through the purchase of a separate flood insurance policy.  Many people don’t think that they need flood insurance because they are in a low risk zone but it is important to note that 25-30% of all flood insurance claims come from moderate to low-risk zones.  Therefore, I recommend considering a flood insurance policy even if you aren’t in a special flood hazard or high risk zone.  If your property is located in a low-risk zone, coverage is often very affordable and therefore it is worth getting a quote.   Just like all insurance policies, flood insurance has exclusions and things that aren’t covered so it is important to understand what the policy does and does not cover.

One additional type of coverage that can often result from hurricanes is hail damage.  I recommend you check your policy form to see if hail damage is included because it is not included on all policy forms.  Additionally, although this article discusses insurance as it relates to your home or property, it is important to review your automobile coverage to see if you are covered for damage to your vehicle that might result from a hurricane.

It is extremely important that your review your policies prior to a storm coming.  I would recommend reviewing them prior to hurricane season even starting because most carriers restrict binding authority once a storm watch and/or warning is issued for an area.  Since storms can pop up at any time, you don’t want to wait until it is too late to review your coverage.  Give us a call today and we would be happy to provide a complete review for you!




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