Like an auto, health, or home insurance deductible, a hurricane deductible is the amount of money you pay out of pocket before your insurance benefits kick in to cover a claim. If you live in an area prone to hurricanes, like Florida, your home insurance will have two deductibles:
In general, wind damage incurred during specific weather conditions and timeframes trigger your hurricane deductible. A hurricane is generally defined as a windstorm of 74 miles an hour or more that touches ground. When the National Weather Service “names” a storm, that’s typically when your hurricane deductible will apply.
Timing is also a factor in triggering hurricane deductibles. For example, the hurricane deductible may apply if the damage occurs:
Insurers and states may have their own hurricane deductible requirements, so ask your provider for clarification. For example, in Florida, hurricane deductibles apply to windstorm losses that occur:
To illustrate why these triggers matter, consider Hurricane Sandy. Homeowners across the East Coast were saved perhaps billions of dollars in out-of-pocket damage costs because it was downgraded to a “tropical storm” before it made landfall.
Lastly, keep in mind that hurricane coverage doesn’t address flood damage from storm surges — you must have flood insurance for that protection.
Hurricane deductibles are a percentage of the coverage you have for your home, typically 1%, 2%, 3%, 5%, or 10%. So if you have a 3% hurricane deductible and $300,000 in dwelling coverage for your home, you’d be responsible for the first $9,000 worth of hurricane damage. Your policy can usually cover the rest, depending on its coverage limits and restrictions.
Hurricane damage is usually extensive. Even though a $9,000 deductible may seem steep, it pales in comparison to the cost of rebuilding your home from the ground up without the financial help hurricane coverage offers.
When choosing your hurricane deductible, keep in mind that the higher the deductible you choose, the lower your premium may be. If your home has certified windstorm mitigation features, such as window shutters, hurricane rated doors, and braced walls and roofs, you might consider a higher deductible because your loss risk is reduced. However, as with any deductible, make sure you select an amount you could reasonably pay in an emergency. Your insurance is only useful if you can use it.