Can you insure your home against hurricane damage?

If your home is located in a region visited now and then by hurricanes, it is vital that homeowners do what they can protect their properties against the storms. The first thing is to acknowledge that hurricane insurance is needed. Playing the wishful thinking card is not the right mindset to be in when considering the need for the insurance.

For some reason, natural disasters such as hurricanes generally don’t rank high in homeowners’ planning. According to United Policyholders, an advocacy organization of insurance consumers, two out of three homeowners are underinsured for a natural calamity. It might be that the financial obligations incurred in buying a house and insuring it against normal hazards such as fire and accident are all that many homeowners believe they can afford.

But after a hurricane blows up and leaves the home of one of these underinsured property owners unlivable, the premiums will seem to have been a small price to pay for recovery. So, yes, hurricane insurance is a good investment. But to insure your home against hurricane coverage is not the end of it: A property owner should know what his policy actually covers.

Deductibles are sometimes misunderstood in hurricane policies. Is it a dollar amount or a percentage of the insured value of the home? The higher the deductible, the lower the premium, but when a catastrophic storm blows through, the money saved in premiums is likely to be more than offset by the big bill the property owner will have to foot himself.

Does your coverage reflect the fact that the house has functional shutters to protect the building’s interior? There’s usually a discount for shuttering. Does your policy specifically cover hurricane damage, as opposed to non-hurricane wind damage? Wind is not wind in the minds of insurance actuaries, and residents of coastal areas often must include policy provisions for damage from hurricanes, not just winds.

When the storm is brewing off the coast is not the time to decide to insure your home against hurricane damage? Protecting yourself against hurricanes is done before hurricane season.

by Morgan Moran