Does Your Insurance Cover Hurricanes

Hurricanes are massive tropical cyclones that usually strike in summer and early fall. They carry with them high winds and heavy rains. Their sheer size means that an area 300 miles away from the eye of the storm may receive wind and rain as well. Does regular homeowner’s insurance cover hurricane damage? How can a homeowner know what’s covered and what’s not?

With over 68 million people living in areas that are vulnerable to hurricanes, there is obviously a real need for insurance coverage on these storms. The bad news is that regular homeowner’s insurance does not cover hurricane damage. The good news is that hurricane insurance is available. The only way to know for certain if a homeowner has hurricane insurance is to call the insurance company that carries the homeowner’s policy and ask. A homeowner will probably need the insurance policy papers, or at least an account number so the agent can look up the coverage. If the homeowner does have hurricane insurance, he or she needs to know how much the deductible is. They can range anywhere from $2,000-$30,000, an usually, the lower the deductible, the higher the premium. The deductible, of course, is how much the homeowner will have to pay out-of-pocket for repairs before the coverage kicks in.

Flooding and hurricanes go together, so a homeowner needs to make certain there is a flooding clause in the hurricane coverage. Some hurricane policies do not cover flood damage, strangely enough, so a person living in a flood-prone area should have this coverage. A wise homeowner will also determine exactly how much coverage his insurance will provide, in case the house is a total loss. Some policies are “replacement cost” coverage. This means the homeowner will receive coverage in the amount of the appraised value of the house. If the re-building costs run over this total, the homeowner will have to pay them out-of-pocket. “Extended replacement” policies are the best choice for homeowners with larger homes, and for widespread disasters.

A large-scale hurricane will tend to push up supplies and labor costs beyond the norm, and an extended replacement policy will ensure that the home is covered, regardless of construction costs. Coverage can also be purchased to cover the changes in construction costs since the house was built (inflation guard) and to reflect code changes/upgrades and sewer construction. This is vital if the community has instituted massive changes in the building codes, such as building to withstand hurricanes. Also, every home needs a sewer, so sewer construction coverage is also crucial. One vital bit of coverage is for living expenses. This will provide a family the funds for staying in a hotel, food and other sundries that arise in the business of day-to-day living. Coverage is also available for personal possessions. This includes clothing, furniture, and even kitchen utensils. Anything not part of the structure that was in the house before the storm is considered a personal possession and may be covered if the policy includes this rider.

A hurricane may destroy a house and flood the streets, but a homeowner who has good hurricane insurance can have a little peace of mind that replacing his home will not be the devastating expense it might have otherwise been. All it takes is a phone call to the insurance agent.