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Does homeowners insurance cover hurricane damage?

Wed Oct 23 2024

Strong winds from a hurricane have toppled over an oak tree in a residential neighborhood.

In spite of its importance in protecting your property and financial future, homeowners insurance sometimes causes confusion. There are tons of misperceptions about what it covers and what it doesn’t – particularly when it comes to hurricane protection.

What is hurricane insurance, and what does it cover? What is a hurricane deductible? What is not covered under hurricane insurance? Is there additional coverage you should consider?

In this blog, we cover these topics that may be critical in protecting your financial future. Perhaps most importantly, we answer the bigger question: Does homeowners insurance cover hurricane damage?

What hurricane damage does homeowners insurance cover?

The standard homeowners insurance policy typically covers certain types of hurricane damage to your dwelling and detached outbuildings and structures as well as your . personal property. And if hurricane damage makes your home unlivable, then many policies also help with your additional living expenses.

But what type of hurricane damage can home insurance cover? More often than not, that depends on what perils your policy already covers. The best example of this is windstorm.

Coverage for wind damage

Damage from high winds, including hurricane-force winds, is generally covered under a standard homeowners insurance policy. So if a hurricane causes wind damage to your home, you’re most likely covered.

Homeowners along the coast should note that their home insurance may have a hurricane deductible. This deductible, separate from your standard deductible, applies when damage is caused by a named storm, like a hurricane or a tropical storm. The specifics vary by state and insurance company.

What hurricane damage isn’t included under a homeowners insurance policy?

Hurricane damage is typically not covered when it’s caused by events excluded by your policy language. The best example of this is flooding.

Flood exclusion

Most standard homeowners insurance policies do not provide coverage for flood damage. Flooding generally refers to water rising or overflowing from nearby lakes, rivers, and streams onto normally dry land. Coverage for this type of damage may be available through a separate flood insurance policy.

Storm surge considerations

Storm surge is when strong winds cause the sea level to rise above normal. Unfortunately, the damage it causes is not covered under a standard homeowners insurance policy. Rising water caused by a storm surge is typically covered by flood insurance.

Additional hurricane coverage options to consider

Thankfully, there are a variety of riders and endorsements that can be purchased to help cover gaps in your homeowners insurance policy.

Flood insurance

Flood insurance is becoming increasingly important, especially in coastal states. In some locations, called Special Flood Hazard Areas, flood coverage is required if you have a mortgage backed by the federal government. But other mortgage lenders may also require flood insurance.  

Many homeowners get their flood policies through the National Flood Insurance Program, but you may also be able to find coverage through private insurers.

Windstorm insurance

While wind damage is generally covered under a standard home insurance policy, some insurance companies exclude it in coastal areas at high risk for hurricanes. Moreover, some states allow homeowners to opt out of windstorm insurance. 

In many cases, however, mortgage companies prefer homeowners to be protected against wind damage. This sometimes means they may end up getting a windstorm insurance policy from a state-run program.

Sewer backup coverage

Your basic homeowners insurance policy may not cover sewer backup damage and clean-up. This risk can usually be managed through a water backup and sump overflow endorsement.

Debris removal coverage

High winds and hurricanes can leave debris on your property, including fallen trees, branches, limbs, roofing materials, siding, and other materials. A large amount of debris can be expensive to remove, but that cost usually isn’t covered under your basic policy. Make sure you ask your insurance agent about possible endorsements to add or increase debris removal coverage.

What is a hurricane deductible?

A hurricane deductible is the out-of-pocket expense you’re responsible for when your home is damaged by wind from a hurricane. This is separate from your standard, or all other perils, deductible.

Hurricane deductibles can be a flat amount, but sometimes they’re tied to the value of the insured property. Essentially, that means your hurricane deductible is a percentage of your dwelling coverage, which often makes the cost to you much higher than a standard home insurance deductible.

Hurricane deductibles may come into play in a couple situations, like when:

  • A storm is officially designated a hurricane by the National Hurricane Center of the National Weather Service. Any designation by any other person or entity is not valid and doesn’t activate a hurricane deductible.

  • There are hurricane warnings, actual hurricane conditions, and the storm has to make landfall as a hurricane. In Florida, all of the conditions need to occur for hurricane deductibles to apply. Insurers in other states may have other requirements.

  • Other triggering events occur. Other states don’t necessarily have laws governing when hurricane deductibles apply. In these places, you need to check your policy language or talk to your agent about what triggers your hurricane deductible.

FYI, your policy can also have a named storm deductible in some states. These deductibles work much the same way hurricane deductibles do, only they’re triggered by tropical storms or hurricanes. 

How hurricane deductibles are calculated

Hurricane deductibles are frequently 2%, 5%, or 10% of the coverage on the main structure.

For example, let’s say your home’s replacement value is $400,000, then a:

  • 2% deductible would be $8,000.

  • 5% deductible would be $20,000.

  • 10% deductible would be $40,000.

While these hurricane deductibles may be significantly higher than standard homeowners insurance deductibles, the coverage at least provides some protection should a costly storm hit. It also can fulfill a commitment to carry hurricane insurance if there is a mortgage on the home.

States with hurricane deductibles

Hurricane and windstorm deductibles are usually available in the following 19 states and the District of Columbia:

  • Alabama

  • Connecticut

  • Delaware

  • Florida

  • Georgia

  • Hawaii

  • Louisiana

  • Maine

  • Maryland

  • Massachusetts

  • Mississippi

  • New Jersey

  • New York

  • North Carolina

  • Pennsylvania

  • Rhodes Island

  • South Carolina

  • Texas

  • Virginia

  • Washington DC

How to ensure you’re properly covered

Here are the steps each homeowner should take to ensure their home is properly insured.

Review your policy annually

Sometimes homeowners don’t understand the provisions of their homeowners insurance policy. This can lead to gaps in coverage and to being underinsured, especially if they’ve made any significant changes to their properties. This is why homeowners are encouraged to have a home insurance review annually.

An annual homeowners insurance review keeps you aware of your coverage and ensures that your coverage is keeping up with inflation and increasing values.

Documenting your property

Another key to making sure you have adequate coverage is to document your property and create an inventory of your home’s contents and belongings. This can be done through images, a video, or as a written document. Include any information you may have about your belongings, including when they were acquired and the price you paid.

When filing a claim, it is easy to overlook some of your valuables. Be sure to include videos or images of items in your drawers, cupboards, closets, and in your garage.

A home inventory is also beneficial when it’s time to buy coverage or renew your policy. Looking over it can help you decide how much personal property insurance you need. 

Steps to take after hurricane damage

If your property is damaged by a hurricane, here are steps you can take to facilitate a smoother and faster claims process.

Filing an insurance claim

After suffering damage from a hurricane, one of the first steps is to promptly notify your insurance company. This is called a first notice of loss, and it starts the claims process. 

Your insurance company will likely keep track of its communications with you, but it certainly doesn’t hurt to have your own record so keep a record of every email, letter, and phone call. It’s also important to follow any instructions your insurer provides.

Document damage

Begin documenting your damage using notes, images, and videos. Your insurer’s adjuster needs these to make sure the damage is storm related. Try to do this before you attempt to mitigate your damage.

Mitigating further damage

Most policies require homeowners to do their best to prevent further damage. This may include covering leaks in the roof, stopping further water intrusion, and even removing any standing water in the home by using fans to move air and limit mold growth. These are things you should only do if you can do so safely.

Be prepared

As with any type of hurricane preparation, understanding how your policy protects your finances before a hurricane or other named storm hits is key to getting back to normal. Knowing what’s covered and what’s not allows you to determine if you have the policy that’s appropriate for your unique situation.

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