A hurricane deductible is the money you will need to pay on your home insurance claim before the insurance provider covers the rest of the damages caused by a hurricane. These hurricane deductibles are usually found in home, condo, and landlord insurance. Reaching out to your insurance agent is key in understanding the details of your policy to ensure you are well-prepared for hurricanes.
History of Hurricane Deductibles
The massive impact of Hurricane Katrina in New Orleans and throughout the Gulf Coast caused over $41 billion in home insurance claims. All of these claims were a major burden on the insurance industry. These companies no longer could afford the risk of dealing with such a high payout.
Insurance providers created a new method for calculating how much a homeowner needs to pay for storm damages before their insurance covers the remaining costs. Hurricane deductibles increase the amount a homeowner must pay while decreasing the financial responsibility of the insurer.
How Much Does a Hurricane Deductible Cost?
Most standard deductibles range anywhere from $500 to $2,500 for each claim, but a hurricane deductible is usually based on the percentage of the dwelling coverage for your home. You can also choose your percentage, as this ranges anywhere from 2% to 10% of your dwelling coverage.
For example, if you have a 5% hurricane deductible and your home is worth $250,000, you will need to pay $12,500 on your hurricane damages claim before the insurance company will cover the rest.
A higher deductible will lower your premiums, while a lower deductible will increase the cost of your premiums. You can also modify your deductible at any time. Choosing to discuss all of your options with an insurance agency is helpful in finding the right balance to meet your needs.
What Triggers a Hurricane Deductible?
Each state has its own requirements for hurricane deductibles. Keeping up with your state’s requirements is essential in understanding your coverage. For example, a hurricane deductible in Florida will happen once the National Weather Service declares a hurricane, and it can last up to 72 hours after the hurricane watch or warning ends. It’s also important to know that a hurricane deductible won’t cover any damages caused by flooding from storm surges, as you will need flood insurance for additional protection.
How Does the Hurricane Deductible Process Work?
A hurricane deductible acts similar to a standard home insurance deductible in that you will need to pay your deductible before your insurance provider handles the remaining costs. However, it’s important to know that a hurricane deductible can only be enacted if your home suffers damages from a Category 1 hurricane or higher.
On the other hand, a standard home insurance deductible will most likely be used if the wind conditions stay within the tropical storm range, which is anything less than 74 miles per hour. Ultimately, choosing a lower deductible is often a wise decision if you live near the Florida coast or in hurricane-prone locations.
Which States Require a Hurricane Deductible?
Currently, 19 states require insurance companies to use the hurricane deductible model due to the damaging impact of Hurricane Katrina in 2005. Florida is included in this list due to the likelihood of hurricanes impacting the state each year. The state also limits insurance providers on the minimum and the maximum amount they can charge for a hurricane deductible.
These requirements include deductible options of $500, 2%, 5%, and 10%, as the percentages are based on the total value of your house. Contacting an insurance agency is always a good idea in determining the best options to meet your needs while staying within your budget.
Why You Need an Insurance Agency
Trying to find the best home insurance available is often a time-consuming and difficult task. Comparing all of the different insurance providers can feel overwhelming and stressful. Choosing to partner with a local insurance agency makes the process of finding home insurance much easier. These insurance professionals can also discuss all of your options to ensure you find the right hurricane deductible for your policy. Working with an insurance agency will give you peace of mind, and they are only a phone call away if you ever have any questions.
Reach Out to Wellcovered Insurance to Buy Home Insurance
Wellcovered Insurance is one of the best insurance agencies in Florida. Our company works with more than 30 insurance carriers across the United States. We strive to find you the best coverage while investing in state-of-the-art technology that makes it easy to compare all of the top options for home insurance.
Our focus is also on creating the best customer experience, as we are happy to answer all of your questions over the phone, or you can visit our office. We can provide you with an auto quote in 15 minutes, while a home quote only takes one or two business days. Our agency also provides many other insurance options, whether you need rental property, general liability, condo, boat, commercial property, or something else.
Wellcovered Insurance is also one of the top-rated insurance agencies on Google Reviews, and we take pride in always staying active in the local community. Feel free to reach out to Wellcovered Insurance to find the best and most affordable home insurance today!