Does Homeowners Insurance Cover Hurricane Damage?

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Popular Questions:

Is hurricane damage covered under standard homeowners insurance policies?
When and how does homeowners insurance cover hurricane damage?
How much do I have to pay if homeowners insurance does cover hurricane damage?
If homeowners insurance doesn’t cover hurricane damage, what will?
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Is hurricane damage covered under standard homeowners insurance policies?

As a new homeowner, I’m curious about what all is covered under my insurance. I live in an area that’s prone to hurricanes, and I’m worried about my home being protected by my insurance if disaster strikes. I know hurricanes can cause expensive damage or even tear homes apart completely. Is hurricane damage covered under standard homeowners policies?

Yes, it is—with a BIG “however." Certain areas of the country, such as the lower East Coast and the Gulf Coast, have areas known as “wind pools,” or basically areas where windstorms strike frequently. These states allow homeowners insurance providers to not offer windstorm coverage for homes located in wind pool areas. So, those are the areas where coverage gets dicey. If you live outside these areas of the country, your standard policy provides windstorm coverage.

When and how does homeowners insurance cover hurricane damage?

A standard homeowners policy provides coverage for hurricane damage under the “windstorm” peril. Depending on where you live in the country, your coverage may be more or less limited. Nineteen states in the US have hurricane deductibles that you must meet before the insurance company starts paying. You’ll need to review your specific policy with your independent insurance agent to be sure of the exact amount of coverage you have.

If your policy provides coverage for windstorm damage, your insurance will pay for repairs necessary to your home after a storm passes. You may have shattered windows, a roof that’s blown off, or an entire section of your house that was torn away by the hurricane. Homeowners insurance is there to help you repair or rebuild your home without going into massive debt following a severe natural disaster such as a hurricane.

How much do I have to pay if homeowners insurance does cover hurricane damage?

If you’re in a state that has a windstorm deductible, you’ll be responsible for first covering that amount out of your own pocket. Deductible amounts vary by policy, but they’re often a percentage of your home’s total insured value. The percentage may be as low as a fraction of a percent, or as high as 5% or more. The windstorm deductible may be a special amount, such as 2%, while your policy lists all other perils as having a $1,000 deductible. It just depends.

Once you’ve met your deductible, your insurance company will pay out for the remainder of the damage up to your home’s total insured amount. Work with your independent insurance agent to review your policy to find out exactly how much you’ll be responsible for paying in the event of windstorm damage to your home. It’s best to know this ahead of time, before disaster strikes.

If homeowners insurance doesn’t cover hurricane damage, what will?

If you are in a wind pool area, you’ll need to visit a government-sanctioned insurer of last resort to obtain coverage for hurricane damage. These special associations are responsible for writing insurance policies for people who are considered to be an extremely high insurance risk. In this case, it’s just your geographic location that determines how high of a risk you are when it comes to storms and related insurance coverage.

These high-risk areas along the coast are commonly known as “wind pools," but they may also be referred to as “beach pools,” because homes along the beach are at very high risk of hurricane damage as well. Unfortunately, these special windstorm policies can be much more expensive than a standard homeowners insurance policy.

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TrustedChoice.com Article | Reviewed by Paul Martin

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https://www.iii.org/article/background-on-hurricane-and-windstorm-deductibles