Hurricane Insurance, Part 2: 4 Tips for Ensuring Comprehensive Hurricane Insurance Coverage

This post is the second in a two-part series about insurance coverage for hurricanes. Click here to read part one, Hurricane Insurance: 6 Tips for a Successful Claims Process.

When hurricanes roll in, violent weather in the form of extreme rain and high-speed winds results in loss of life and property alike. We saw the devastating results near the end of this year’s hurricane season during Tropical Storm Lidia, Hurricane Irma and Hurricane Harvey, and people who were affected are still rebuilding their homes and their lives.

Before another wave of storms makes landfall next hurricane season, take time now to review your current insurance policies relevant to hurricane damage. Pay close attention to the following areas of your coverage to make sure you and your family have the right protection in place.

1. Consider adding flood insurance no matter your risk. One of the effects that made Hurricane Harvey so devastating was that it stayed stationary over the Houston area for days on end while constantly bucketing rain. It broke a record for flooding throughout south Texas.

Unfortunately, 80 percent of flood damage victims didn’t have flood insurance because their homes were not in high-risk flood areas, and flooding is a common exclusion under most property policies. These factors only added to the difficulty of recovery, showing a watching world that even if a home is in a low-risk flood plain, extreme flooding is still possible. Anyone who owns a home or leads a community in a flood plain should strongly consider carrying flood insurance, no matter how low the risk might be.

2. Assess your wind coverage deductibles. There are two types of wind coverage deductibles:

• Wind-hail deductible, which covers any damage from wind and/or hail.
• Named wind-storm deductible, which only covers damage from hurricanes named by the National Weather Service. 

Review your policy to find out whether you have both of these different deductibles addressing wind or just one. Also check to see if your wind related deductibles are flat deductibles, per building deductibles, or per occurrence deductibles as each of these have a different impact on your community. The difference in coverage and what you pay to meet your deductible could be significant in the event your home or community is damaged by a hurricane.

3. Make sure your property values are accurate. Accurate property values will ensure you receive the fairest payout; they’re always a major factor in the amount you’ll receive when a carrier and pays out a portion of your policy due to a loss. In an area where one storm could literally compromise everything your community insures, it’s even more important to be confident in the values on file with your agent.  Open up the dialogue and make sure you completely understand that what’s currently being insured represents a viable market value and should follow the community’s governing documents.  Also look at how deductibles stack up after a hurricane – damage caused by wind and hail and damage caused by rising floodwaters will have different deductibles you’ll be responsible for meeting.

4. Always check your deductible. Consider it in the best and worst case scenario. If you’re in an area where using the policy is more of a “when” and not an “if” then find out the minimum deductible you can afford. In the case of an association, you can be prepared with a reserve amount in the event that deductible isn’t reached.

Living through an event like a hurricane is always stressful. By learning more about your policies and taking steps to make them as comprehensive as possible, you can help yourself be as prepared as possible if the next big storm hits your home or community.