A deductible is the portion of a covered home insurance claim you're responsible for. It's subtracted from your payout, not billed to you directly. In states with tropical storm and hurricane risk, many home insurance policies carry a separate named storm or hurricane deductible, which differs from the standard deductible that applies to other damage. A named storm deductible applies once the National Hurricane Center has officially named a storm, whereas a hurricane deductible applies only if that storm strengthens into a hurricane.
Because only some named storms become hurricanes, a named storm deductible typically applies more often than a hurricane deductible would on the same policy.
What is a named storm deductible?
Developing storms receive a name from the National Hurricane Center when they have sustained winds of at least 39 mph. Not all named storms develop into hurricanes. But once a storm is officially named, any covered damage your home sustains due to the storm will be subject to a named storm deductible, if your policy has one.
Named storm deductibles are separate from standard home insurance deductibles. Standard deductibles are usually flat-dollar amounts, but named storm deductibles are typically percentage-based. The percentage is usually 1% to 5% and calculated based on your dwelling coverage — the part of your policy that pays to rebuild your home's structure, sometimes labeled Coverage A.
For example, if you have $400,000 in dwelling coverage and a 3% named storm deductible, your insurer would subtract $12,000 from your payout for a covered claim due to a named storm.
$400,000 x 0.03 = $12,000 deductible responsibility
What is a hurricane deductible?
Hurricane deductibles are less broad than named storm deductibles, because not all named storms will strengthen to hurricanes. Tropical storms become hurricanes once they reach sustained winds of 74 mph.
Timing matters when it comes to hurricane deductibles. If storm damage occurs to your home before a storm is officially declared a hurricane, then your hurricane deductible would generally not apply. The same is true if a hurricane is downgraded to a tropical storm before it damages your home.
Like named storm deductibles, hurricane deductibles are also typically percentage-based.
Named storm deductible vs. hurricane deductible: Key differences
Not all home insurance policies carry a named storm or hurricane deductible. If they do, they generally carry one or the other, not both. You only need to pay one home insurance deductible for a covered loss. Policies with named storm or hurricane deductibles will also have a separate standard deductible (sometimes called all other perils deductible) that applies to claims stemming from other causes of loss.
|
Deductible type |
Trigger condition |
Deductible applies when |
|
Named storm deductible |
Storm is named by the National Weather Service or National Hurricane Center |
You file a claim for covered damage due to a named storm |
|
Hurricane deductible |
Named storm intensifies to a hurricane with sustained winds of 74 mph or higher |
You file a claim for covered damage due to a hurricane |
Which states allow hurricane or named storm deductibles?
Only coastal states with exposure to hurricanes and tropical storms have hurricane or named storm deductibles. According to the Insurance Information Institute, 19 states and Washington, D.C. currently have some form of hurricane, named storm, or wind/hail deductible:
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Alabama
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Connecticut
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Delaware
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Florida
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Georgia
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Hawaii
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Louisiana
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Maine
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Maryland
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Massachusetts
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Mississippi
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New Jersey
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New York
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North Carolina
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Pennsylvania
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Rhode Island
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South Carolina
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Texas
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Virginia
Hurricane and named storm deductible levels and application vary by insurer within each state, except in Florida, where the law dictates hurricane deductible levels and application. Some other states require individual insurance companies’ hurricane deductibles to be reviewed by the state insurance department. Most insurance companies have a set timing window for deductible application based on when the storm is named and if or when it is downgraded.
Frequently asked questions
What qualifies as a named storm?
Storms are officially named by the National Weather Service or National Hurricane Center. Developing storms are named when they have sustained winds of at least 39 mph. Tropical storms officially develop into hurricanes when they have sustained winds of 74 mph or more.
Does homeowners insurance cover named storms?
Unless wind and hail damage is excluded from your home insurance policy, homeowners insurance typically covers hurricane and named storm damage. However, it is usually subject to a named storm deductible. These deductibles are usually percentage-based and calculated based on your home’s insured value (formally called your dwelling coverage limit). Note that flood damage is never covered by standard homeowners insurance, even if you have wind and hail coverage. To be covered for flood damage, homeowners must purchase flood insurance.
What is a good hurricane deductible?
The right hurricane deductible depends on your budget and how much risk you're comfortable taking on. A lower hurricane deductible usually means a higher policy cost (called your premium), but lower out-of-pocket costs if you need to file a claim. Since hurricane deductibles are usually percentage-based, they can add up quickly. Some homeowners choose a higher deductible to lower their premium, then set aside the savings in case they need to cover their deductible later.
You'll also want to weigh your hurricane deductible alongside any auto insurance deductible you have, since hurricanes commonly damage both vehicles and homes. Check your policy declarations page to see your current deductibles, and contact your insurer if you want to make changes.
