Complete Guide to Hurricane Insurance

Here's how hurricane insurance works and where to buy it when you want to cover damage from wind and floods.

NerdWalletSeptember 8, 2020

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Your home isn’t only where your heart is — it’s where your money is. It’s probably your most valuable investment, which is why you have a homeowners insurance policy to protect it.

But even the best home insurance won’t pay for every kind of hurricane damage. If you live in hurricane territory, understanding what your homeowners policy will and won’t cover is key to finding the right hurricane insurance.

Hurricanes bring two main problems: water and wind. You may need to buy these separate policies in order to cover hurricane damage:

  • Flood insurance. No homeowners insurance policy will cover floods, including water from a storm surge. To get coverage, you’ll need flood insurance.

  • Windstorm insurance. Homeowners insurance policies in some hurricane-prone states won’t pay for windstorm damage. If you live in one of these states and want coverage, buy a separate windstorm insurance policy.

Your homeowners policy and hurricane damage

A homeowners insurance policy won't cover flood damage caused by a hurricane; it won’t cover flooding, period. But you can buy flood insurance separately through the National Flood Insurance Program. Many major insurers provide flood insurance through an arrangement with the NFIP, so you can typically buy it from your home insurance agent.

In most states, standard homeowners policies cover damage caused by wind, including hurricanes. But if you live in a high-risk coastal state, you might need to buy separate windstorm insurance, either through your insurance company or a state-run insurance pool. It might also be available as a rider on your current policy. Windstorm insurance covers damage from any high wind, not just hurricanes.

Here are examples of associations offering windstorm coverage — and often coverage for hail damage — for homeowners who live in high-risk coastal areas and are unable to buy it elsewhere:

Understanding hurricane and windstorm deductibles

To limit their financial risk in 19 coastal states and the District of Columbia, some insurers impose a separate hurricane and/or windstorm deductible. An insurance deductible is the amount subtracted from your insurer’s payout for a covered loss.

Home insurance deductibles are often a flat dollar amount, such as $1,000, while windstorm deductibles are typically a percentage of your home’s insured value. They usually range from 1% to 5%, though they can be higher in high-risk coastal areas. If your home is insured for $500,000 and you have a 5% wind deductible, up to $25,000 will be deducted from your payment if you file a claim.

The following states and Washington, D.C., allow insurers to charge special deductibles when there’s hurricane damage, according to the Insurance Information Institute.

States where insurance companies can charge special deductibles for hurricane damage

  • Alabama.

  • Connecticut.

  • Delaware.

  • Florida.

  • Georgia.

  • Hawaii.

  • Louisiana.

  • Maine.

  • Maryland.

  • Massachusetts.

  • Mississippi.

  • New Jersey.

  • New York.

  • North Carolina.

  • Pennsylvania.

  • Rhode Island.

  • South Carolina.

  • Texas.

  • Virginia.

Insurers can apply a hurricane deductible only in a true hurricane; a “trigger” in your homeowners policy dictates when it kicks in. For example, the “naming” of a storm could trigger a deductible. A windstorm deductible applies to damage from any kind of high wind.

Deductible percentages vary by state and insurance company. For example:

  • Alabama. The base hurricane deductible for policies sold by the Alabama Insurance Underwriting Association is 5%.

  • Florida. Insurers must offer hurricane deductible options of $500, 2%, 5% and 10%. Deductibles can exceed 10% in some cases.

  • Massachusetts. Minimum windstorm deductibles are generally between 1% and 5% and depend on the home’s location and distance from shore.

  • New York. Deductibles range from 1% to 5%. Higher deductibles are also available.

  • Pennsylvania. Hurricane and storm deductibles typically range from 1% to 5% under homeowners policies.

  • Rhode Island. A hurricane deductible on a homeowners policy cannot exceed 5% of a home’s insured value.

The cost of hurricane insurance

The cost of a windstorm policy depends on the amount of your deductible, where you live, and how much it would cost to rebuild your house. Flood insurance costs also depend on where you live and the deductible you choose.

Tips for buying hurricane insurance

  • Whether you’re buying homeowners insurance, flood insurance or windstorm insurance — or all three — make sure you have enough coverage to pay for the full cost of rebuilding your house and replacing your possessions. Your insurance agent can help you pinpoint the right amount.

  • Don’t procrastinate. Flood insurance policies usually impose a 30-day waiting period between the time you buy and the time coverage takes effect. And insurers typically won’t adjust your coverage once a storm is forecast.

  • Any time your policy is up for renewal, remember that you may be able to save money by comparing quotes.

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