Hurricane Insurance Isn't Real. Instead, You Need This Coverage for Storm Damage

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Published October 31, 2024

hurricane charley — Hurricane Charley caused heavy damage to this ret🧔irement communꦯity in Punta Gorda, Florida. Mario Tama/Getty Images

What Is Hurricane Insurance?

Hurricane insurance doesn't exist as a separate type of policy. The term usually means a hurricane deductible on a homeowners insurance policy, which is the amount a homeowner pays before the insurer covers hurricane damage. This deductible, based on a percentage of the property's value, is common in 19 hurricane-prone states and the District of Columbia.

It can also mean particular types of catastrophe insurance that cover flooding or extreme winds, which is often required in high-risk states like Florida and Texas.ꦿ🌊

Key Takeaways

There is no such thing as hurricane insurance, strictly speaking.
Coverage for the damage-inducing waters or winds that hurricanes cause is provided by flood insurance or windstorm insurance.
Many homeowners insurance policies in coastal states impose a hurricane deductible, an extra out-of-pocket amount the policyholder incurs before coverage kicks in.

Understanding Hurricane Insurance

澳洲幸运5官方开奖结果体彩网:Hurricane deductibles are separate from regular homeowners insurance deductibles and are based on a percentage of 𒁃the home’s value. While a regular homeowners insurance policy deductible is a fixed dollar amount—say, $500 or $2,000—a hurricane deductible might be 2% to 5% of a home’s insured value, 🌃or $2,000 to $5,000 for every $100,000 in coverage.

Hurricane deductibles first developed in 1992 after Hurricane Andrew inflicted major losses on homeowners insurance companies in Florida, but they became more widespread in 2005, in the wake of Hurricane Katrina. Insurance companies turn to 澳洲幸运5官方开奖结果体彩网:reinsurers when they’re having trouble paying large amounts of claims all at once, but even reinsurance companies struggled to cope with such enormous losses. As a result, insurance companies began requiring hurricane deductibles in 19 states and Washington, D.C. Homes in these states, which are all on the Gulf of Mexico or Atlantic Coast, are susceptible to hurricane damage.

A homeowner is usually required to pay a hurricane deductible if there is a named hurricane in the area.𝕴 Somet🎶imes, a severe tropical storm triggers the deductible. The hurricane deductible is in effect for any damage that occurs until the storm is downgraded. Rules vary by state.

Even when a hurricane deductible doesn't apply, a windstorm deductible might. A windstorm deductible applies to damage from any kind of high wind. It can run slightly lower than a hurricane deductible, sometimes as low as 1% of the property's insured worth.

States Where Hurricane Deductibles Apply

The stat🌟es/regions where hurricane deductibles apply are🍸:

Alabama
Connecticut
Delaware
Florida
Georgia
Hawaii
Louisiana
Maine
Maryland
Massachusetts
Mississippi
New Jersey
New York
North Carolina
Pennsylvania
Rhode Island
South Carolina
Texas
Virginia
Washington D.C.

Policies Offering Hurricane Coverage

Homeowners should also be aware that even if they pay a hurricane deductible, gaps in their coverage might exist. Most homeowners policies don't cover flooding caused by an outside natural event, like a hurricane. Property owners need a separate 澳洲幸运5官方开奖结果体彩网:flood insurance policy to cover such water-related destruction or damage.

Important

Most standard homeowners policies wiꦏll cover some damage caused by hurricanes—mostlꦺy related to the heavy wind that, say, rips shingles off a roof or causes a tree branch to snap and crash into a window.

Also, homeowners insurance policies in some hurricane-prone states won’t pay for wind-related damage. So, if you want to protect your property, you must purchase separate windstorm insurance. In this case, all wind damage or destruction would fall under this policy instead of the traditional homeowners policy. On top of 澳洲幸运5官方开奖结果体彩网:hurricane coverage, windstorm insurance applies to problems stemming from tornadoes, cyclones, and other types of high-speed winds.

How Hurricane Deductibles Are Calculated

To some degree, depending on the state, insurance companies dictate the level of the hurricane deductible and where it should apply. However, insurers' hurricane deductible plans are subject to state regulations. Rhode Island, for example, sets a cap of 5% on hurricane and windstorm deductibles.

In hurricane-prone Florida, the state requires homeowners to have the option of a $500 flat-rate hurricane deductible. Premiums may, of course, be higher than if you choose one of the other mandated options: 2%, 5%, or 10% of the insured value of the residence.

In some states, homeowners m💝ay pay lower insurance premiums if they make improvements to their home to minimize damage from a hurrica𒊎ne, such as installing storm shutters or hurricane-resistant laminated glass windows and doors.

Are Wind and Hurricane Insurance the Same?

A windstorm insurance policy may be different than a hurricane insurance policy. With a windstorm insurance, coverage is for damage caused by wind only. While there is no specific "hurricane insurance," this insurance may refer a a combination of a windstorm policy, flood insurance, and homeowners insurance.

Is Hurricane Insurance the Same as Flood Insurance?

Hurricane insurance and 澳洲幸运5官方开奖结果体彩网:flood insurance may sometimes be considered the same. Flood insurance covers damage from flooding, which may include flooding caused by hurricanes, but could also cov🐠er damage from other causes, like a leaked pipe. Hurricane insurance is typically a combination of flood and windstorm insurance, which covers damage cau🎶sed by wind, such as from hurricanes.

Are Hurricanes Usually Part of Homeowners Insurance?

You may have to get separate flood insurance and windstorm insurance to cover hurricane damage. These policies may not be part of homeowners insurance, however some policies may include windstorm insurance. Most standard homeowners insurance won't cover flood damage.

The Bottom Line

Hurricane insurance can be a valuable tool to protect you from financial hardship in the event your home suffers from damage from a hurricane. Whether hurricane insurance is right for you will depend on several factors, including the risk that a hurricane will damage your home and your financial situation. Consider consulting a financial 📖advisor for guidance with your specific needs.

Article Sources

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