Hurricanes are a regular occurrence across the U.S., with every state experiencing hurricane damage at some point since records began. Although major hurricanes like Michael and Katrina have caused billions of dollars in damages, minor hurricanes and storms can also cause damage to people and property. For this reason, it is important to have the right type of hurricane insurance coverage in case your home is damaged or destroyed.
Hurricane Insurance Is Not A Category
Firstly, it is important to mention there is no such thing as “hurricane insurance”. This is a common misconception. When insurers talk about coverage for hurricanes they are actually referring to a number of coverage options that will payout for hurricane-related damages.
For this reason, American citizens cannot simply go and buy a dedicated hurricane insurance plan. However, insurers do offer a number of coverage options for hurricanes. Homeowners need to familiarize themselves with the various types of coverage to ensure they do not have to pay for repair and reconstruction out-of-pocket.
What Insurance Do You Need To Be Covered For A Hurricane?
Damage from hurricanes can range from a flooded yard to total destruction of a property. The difficulty in predicting the extent of hurricane damage means that most insurers will provide coverage through plans that target a number of different types of natural disasters. The chances are most homeowners already have a limited amount of coverage through their existing policies, such as their homeowners’ insurance plan.
Flood Insurance
Floods are the most common natural disaster in the U.S. It is estimated 25% of flooded homes were actually in low-to-moderate risk zones. Even a single inch of water can cause up to $25,000 worth of damage within a property. Flood insurance defends homeowners against all forms of flooding, whether caused by a hurricane or not.
Windstorm Insurance
Insurers in states commonly hit by hurricanes, such as Louisiana, Texas and Florida, also provide additional windstorm insurance plans. This is typically an additional add-on for existing homeowners’ insurance policies. Homeowners should be aware that some policies will exclude wind damage. If this is the case, it is possible to purchase a separate wind insurance policy. Many hurricane-prone states offer wind insurance through state insurance plans.
Homeowners’ Insurance
A standard homeowners’ insurance plan will cover the structure, contents and any expenses if the property is considered uninhabitable. The misconception people make is they assume all they need is homeowners’ insurance. These policies have some notable exceptions in coverage. In particular, homeowners’ insurance will not cover flood damage or earthquakes.
Hurricane Deductibles
Deductibles are a major issue for any collection of policies that comprise hurricane insurance coverage. The deductible charged will depend on the insurer and the perceived risk to a certain property.
Some states have an alternate system, whereby the deductible for hurricane damage is a flat fee. In exchange, holders of these policies will need to contend with higher premiums.
What Homeowners Need To Know About Purchasing Hurricane Insurance
Homeowners need to be aware that insurers will not provide coverage if an area has already been placed under a hurricane watch. For example, homeowners in Texas will not be able to purchase coverage or add additional coverage if there is already a brewing hurricane in the Gulf of Mexico. This applies even if the hurricane in question is not expected to make landfall. Homeowners should aim to take out a policy now to get the most competitive rates and ensure they are adequately covered when hurricane season arrives.
It should also be mentioned that insurers make a distinction between simple bad weather and storms and hurricanes. Generally, a policy will only pay out in the event of a named hurricane making landfall. For storms, bad weather and general flood damage, homeowners will need to fall back on their homeowners’ insurance policy. Insurers are particular when it comes to determining whether a major weather event constitutes a circumstance in which they will pay out. It is understandable because insurers pay out billions of dollars in flood damages every single year, especially in the Southern United States.
Talk To The Insurance Experts
Hurricane insurance is a naturally confusing area of protection for homeowners. The lack of any comprehensive plans means families must take out multiple policies to cover themselves. For this reason, homeowners may want to speak to the insurance experts at Merchant Family Agency. They will be able to tell you what type of coverage you need and whether there are any gaps in your existing coverage. Talk to Merchant Family Agency to find out everything you need to know about protecting your home against the threat of a hurricane.