If you're a homeowner in an area that's vulnerable to hurricanes, you know that hurricane season is a time of year when you have to be extra vigilant. Not only do you have to keep an eye on the weather forecast and make sure you have an emergency plan in place, but you also need to make sure your hurricane insurance is up to date.
Whether you're buying hurricane insurance for the first time or renewing an existing policy, there are a few things you need to keep in mind. In this guide, we'll cover the basics of hurricane insurance and help you understand what kind of coverage you need to protect your home.
What Does Hurricane Insurance Cover?
Hurricane insurance is a type of property insurance that provides protection against damage caused by hurricanes. Most standard homeowners insurance policies do not cover damage caused by hurricanes, so if you live in an area that's vulnerable to these storms, it's important to purchase separate hurricane insurance.
Hurricane insurance typically covers damage caused by high winds, flooding, and rain. It can also provide coverage for additional living expenses if your home is uninhabitable due to damage from the hurricane. Some policies may also provide coverage for debris removal and other repairs.
How Much Hurricane Insurance Do I Need?
The amount of hurricane insurance you need will depend on the value of your home and personal belongings. To determine how much coverage you need, start by getting a home replacement cost appraisal or use one of our expert insurance advisors. This would help you understand how much it would cost to rebuild your home if it was destroyed by a hurricane. When you have a total estimate of the value of your property, add 10-20% to that number to account for inflation and rising construction costs.
After you have an estimate of your home's replacement cost, add up the value of your personal belongings, such as furniture, clothing, electronics, and jewelry. Understanding the cost of replacing your personal property helps ensure you have adequate personal property coverage limits on your homeowner's policy.
Check your deductibles!
Deductibles for hurricane insurance are also typically much higher than those for standard homeowners insurance policies. They can range from 2% to 10% of your home's total value— meaning that if your home is worth $500,000, you could be responsible for paying $10,000-$50,000 out of pocket before your insurer steps in. So when purchasing a hurricane insurance policy, it's important to ensure your deductibles do not exceed your emergencies-only savings funds.
What Affects the Cost of Hurricane Insurance?
Several factors can affect the cost of hurricane insurance, including:
The age and value of your home: Older homes are typically more expensive to insure than newer homes because they're more likely to sustain damage in a storm. The same is true for more valuable homes; if your home is worth more money, it will likely cost more to insure.
Roof age: Your roof's age is one of the most influential factors in calculating your insurance premiums because your roof is the most vulnerable part of your home.
Your location: Hurricane insurance premiums are typically higher in coastal areas because these areas are more vulnerable to storms.
Policy deductibles: The higher your deductible, the lower your insurance will be. However, if you have to file a claim, you'll be responsible for paying the full amount of your deductible before your insurer covers any damage.
Purchasing adequate hurricane insurance is one of the most important things you can do as a homeowner in a vulnerable area. By understanding what kind of coverage you need and how much coverage is right for your situation, you can ensure that your home and belongings are protected in case of severe weather.
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