How Will Your Home Insurance Respond During Hurricane Season?

The best time to prepare for a hurricane is before the onset of the season, not within 48 hours of landfall. 

As we prepare for another hurricane season, planning is key. While trending topics include everything from safeguarding personal property to evacuation routes, another important factor is your homeowner’s insurance. When the winds and rain have come and gone, how will your insurance policy respond? Here is some guidance to help you navigate these turbulent waters.

Officially, the Atlantic hurricane season runs annually from June 1 through Nov. 30 of each year, with September typically producing the most hurricanes. Climate change is also causing more frequent and fierce hurricanes, according to the National Oceanic and Atmospheric Administration (NOAA).

Hurricanes have caused over $2.6 trillion damages since 1980, according to the NOAA.

As a means to mitigate and manage the costly insurance claim dollars, insurance companies have adopted a special deductible, which is applied to property loss damage caused by a windstorm. Generally noted as a percentage of the dwelling insurance value, special deductibles can vary by percentage. Please note special deductibles must be clearly stated on the homeowner policy declarations page.

Many states have introduced a separate deductible for damage caused from windstorms.

Deductibles have always been a critical part of homeowner insurance contracts. While standard “All Other Perils (AOP)” homeowner deductibles are generally applied in a fixed dollar amount before the insurer will pay toward a homeowner claim (e.g. $2,500 per occurrence), windstorm deductibles are usually calculated as a percentage of the dwelling coverage limit. For example, a home insured for $1 million with a 2% deductible means the property owner is responsible for the first $20,000 in costs before the insurance company will respond. Windstorm deductibles may vary from 2% to 15%, depending upon several risk factors, which may or may not be controllable by the homeowner.

In Florida, you only have to pay one hurricane deductible per calendar year, per location.

This provision reduces the financial burden on homeowners, who may incur property damage from multiple storms during the hurricane season in the same calendar year.

Property owners are encouraged to photo document damage incurred, and to keep all receipts associated with the cost of repairs made to their homes, resulting from “named windstorms and hurricanes.” These accumulating expenses do contribute toward meeting the insurance policy’s annual windstorm deductible.

Buying in a hurricane prone state? Pay attention to the details, as they may be different in each state.

Whether you are thinking of buying a new property or relocating to a coastal state, pay attention to the details of the home. Date of construction, proximity to the coastline and the wind mitigation protection of a property are very important underwriting considerations. Even a home, a few years of age older, or few more yards from the coast can greatly impact insurance rates.

Likewise, a property’s Wind Mitigation (window and door opening protection, type and age of roof and water resistance) also plays a vital role in establishing the percentage of windstorm deductible offered. Much of this underwriting information can be collected by a certified home inspector trained in the complexities of completing a Wind Mitigation Inspection Report, which requires interior access to the home and attic space.

All factors mentioned contribute to the percentage of the wind deductible offered and may mean the difference between a 2% and a 15% deductible.

Contact your risk advisor before hurricane season strikes!

Having a clear understanding of your insurance contract language is one of the best ways to get ahead of and to prepare for this year’s hurricane season. If you have questions, be sure to consult with your Oswald Companies insurance advisor before hurricane season begins.

For more information, visit our Personal Risk page or contact us directly.

Related Articles:

• Hurricane Season: Preparation and Contingency
• Water Damage: Exposures to Your Home and the Insurance That Can Protect You

(Sources: nhc.noaa.gov, msn.com, iii.org, myfloridacfo.com)

Note: This communication is for informational purposes only. Although every reasonable effort is made to present current and accurate information, Oswald makes no guarantees of any kind and cannot be held liable for any outdated or incorrect information. View our communications policy.

This information originally appeared in 2021. Updated in October, 2024.