Does Insurance Cover Hurricane Damage?

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A big part of hurricane preparedness are the steps you take to stay alive, like making an evacuation plan and stockpiling supplies.  But what about the financial toll of a hurricane – did you consider your insurance policy?  Unfortunately, most homeowners insurance policies do not cover all hurricane damage.

Hurricanes can cause a lot of damage to your home.  The biggest ones are:

  • Water damage from flooding
  • Wind damage
  • Fallen trees
  • Sewage backups

If you want to be covered, you want to make sure your insurance policy specifically covers all of these types of damage that a hurricane can cause.

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Flood Coverage for Hurricanes

flood damage from hurricane

Homeowner insurance policies will cover water damage that originated from inside the home (like a burst pipe).  But, the moment the water damage comes from outside the home – like heavy rainfalls, snow melt, storm surges, or a mudslide – you are NOT covered.

With the risk of hurricanes and flooding increasing every year, you would think that more people would get insured.  Ironically, the percentage of homes with flood insurance is actually decreasing in many high-risk areas.

Why Get Flood Coverage?

How does flooding destroy homes and property?

The floodwater is often tainted with sewage, so anything porous it touches has to be thrown away – including couches, mattresses, and carpets.  The flood water can cause floors to rot and collapse. And, in the aftermath, toxic mold can start to grow.  This alone can cost thousands to clean up.

Just one inch of floodwater can cause $20,000 in damage to a typical-sized home.  Hurricane Harvey, for example, brought 50 inches.

Not every flood will completely destroy your home.  According to the flood insurance program, the average claim is about $39,000. (1)

If you live in a high-risk zone, then it makes absolute sense to get flood insurance (and may be legally required).  However, bear in mind that people living along coasts or near rivers aren’t the only ones at risk of flood disasters: 25% of homes with flood claims each year are in low-risk zones.

For the many people living paycheck to paycheck, the extra expense of flood coverage seems like an impossible expense.  But it is an expense that could save you from financial ruin.

IMPORTANT: It takes 30 days for flood insurance to come into effect. So you cannot rush out to buy flood insurance before a hurricane lands.  There are some exceptions though.

How Much Does Flood Insurance Cost?

You can get flood insurance from private insurance companies, but the most affordable option is probably to go through the National Flood Insurance Program (NFIP).  It is managed by FEMA and makes the insurance available to anyone in a NFIP-participating community.

The cost of flood insurance depends on whether you are in a high, moderate, or low-risk area.   The NFIP says that coverage starts as low as $129 per year.  However, the average cost of a policy is $700 per year. (2)

What Does Flood Insurance Cover?

flooding from hurricane

NFIP insurance covers a maximum of $250,000 in property damage and $100,000 in contents damage.  Note that property and contents coverage must be purchased separately.  Any additional coverage will need to be purchased from a private insurer.

The property policy WILL cover:

  • Systems (electric, heating, plumbing, solar, etc.)
  • Water heaters, heat pumps, sump pumps
  • Certain appliances such as dishwashers, stoves, and refrigerators
  • Installed carpeting
  • Paneling, cabinets, wallboard
  • Window blinds
  • Staircases, foundation walls, and anchorage systems
  • Up to 10% for detached garages

The contents policy WILL cover:

  • Personal belongings (clothing, furniture, electronics, etc.)
  • Curtains
  • Portable air conditioners
  • Carpets installed over finished floors
  • Laundry machines and dryers
  • Valuable items up to $2,500
  • Food freezers and the food in them (but not refrigerators)

NOT covered:

  • Preventable mold, mildew, or moisture damage
  • Cash, precious metals, or paper valuables
  • Outdoor property (such as pools, patios, fences, decks, or septic systems)
  • Living expenses while the home is not inhabitable
  • Vehicle damage
  • “Loss caused directly by earth movement even if the earth movement is caused by flood”
  • Contents located below ground (such as in a basement) (3)

Wind Damage

It used to be that homeowners insurance covered windstorms.  However, because of how common hurricanes are becoming in many areas, they have started to make exceptions.  There are also exceptions for people living in tornado-prone areas.

Insurance companies also started requiring percentage deductibles instead of fixed-amount deductibles.  So, you could get stuck paying for a large part of the costs for the roof that flew completely off your home.

According to the Insurance Information Institute, these states have windstorm exclusions to standard homeowners insurance policies:

  • Alabama
  • Connecticut
  • Delaware
  • Florida
  • Georgia
  • Louisiana
  • Maryland
  • Massachusetts
  • Mississippi
  • New Jersey
  • New York
  • Rhode Island
  • South Carolina
  • Texas
  • Virginia

Additional states might have special deductibles for windstorms or hurricanes.  Check your policy carefully to see whether you are actually covered for wind damage from a hurricane.

If a windstorm blows the roof off of your home and then allows rainwater to get in, then the water damage will be covered by the windstorm policy. (4)

Was the Damage Caused by Wind or Water?

Note that windstorm and flood insurance policies are often in conflict.  As Merlin Law Group talks about here, the insurance companies might try to claim that certain damage should be covered by the other policy, or that the homeowner should be able to tell which damages were caused by the rain through the missing roof vs. floodwater.

It’s as though they expect homeowners to remain at home and document which damage happened first. Be prepared for a headache when filing your claim!

Sewage Backups and Fallen Trees

fallen tree damage from hurricane

Flood insurance covers sewage backups, but only if the sewage backup was a result of flooding.  If sewage flooding occurs because of another reason, your homeowners insurance may not cover it.   Some policies require a separate policy for sewage backups.

As for fallen trees, a windstorm policy will only cover it if the tree hits your home and causes damage.  If the tree falls into your yard, the cost of removing it (or other debris) will not be covered.

Steps to Take

1. Document Your Valuables

You know that expensive TV you bought?  It will be covered under flood insurance.  However, that’s contingent on you being able to provide proof that you ever owned it.

Hurricane and flooding can completely wash away your valuables, as well as the receipts you have for them.  There are ways to file a claim even without physical evidence of the item or a receipt – but it will probably be a huge hassle.

Save yourself the headache and losses.  Take time to document all of your valuables.  You can do this by taking photos and digital copies of receipts.  Store this all this info on the cloud so it is accessible when you are ready to file a claim.

2. Document Losses After the Disaster

This is probably the last thing you are thinking of when you return to your home after a hurricane or flood.  But take the time to take photos of all the damage.   You will need this for your claim.   An insurance adjuster will also document the damage, but you may need to make repairs long before the adjuster can get to you.

3. Make Necessary Repairs Immediately

After a large disaster, it can take a long time before an insurance adjuster gets to your home for an inspection.  You should make any necessary repairs (such as fixing holes in the roof or throwing out wet carpets).  The last thing you need is more damage because you didn’t fix something critical, thus allowing more water into your home. You can still be reimbursed for these repairs.  Just be sure to save all the receipts and document anything which was thrown away.

4. Make a Claim, Regardless of Your Deductible

Even if your deductible is more than the estimated damages, you should still make a claim.  With flooding, there is often damage that comes to light later on (such as mold damage). If you don’t make a claim right after the flooding occurs, you won’t be able to get coverage for these future damages.

What if You Don’t Have Flood Insurance?

A lot of people mistakenly believe that FEMA gives money to disaster victims. Yes, FEMA can offer grant money for temporary housing, food, and medical care.  However, the maximum they can give out is $33,300.

As for money to repair your home, you will only be offered a Small Business Administration Loan.  These loans do have interest!

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