We’re coming off a record-breaking hurricane season in 2020, with 30 named storms in the Atlantic. So far 2021 isn’t looking that great, either, with an “above average” season predicted by Colorado State University’s Tropical Meteorology Project Team.

The best home insurance policies generally cover wind damage, including hurricane-force winds. There are exceptions along the coast, such as certain coastal areas of Texas, where homeowners may have to buy hurricane insurance and separate windstorm insurance.

But over the last couple of decades, many home insurance companies have been transferring more of the financial responsibility of hurricane damage to homeowners.

Following Hurricane Andrew in 1992, insurance companies started reducing their financial risk by applying special hurricane deductibles. Over a decade later, the catastrophic damages from Hurricane Katrina compelled more and more insurance companies to offset their losses by placing more financial responsibility on policyholders with these special deductibles.

What Are Hurricane Deductibles?

Hurricane deductibles are what you pay for home repairs after hurricane damage and are usually higher (much higher) than a regular home insurance deductible. For example:

  • If you have a house fire, you would pay the amount of your regular deductible toward repairs—let’s say, $1,000. (Check your policy’s declarations page for your deductible amount.)
  • In some states you could have a much higher hurricane deductible—say, 10% of your dwelling coverage, which would be $30,000 on a house that’s insured for $300,000.

Insurance companies can use hurricane deductibles that are either a set amount or a percentage varying from 1% to 5% of the home’s insured value. In some cases, such as states with higher wind risk, these percentages are upwards of 10%.

In Florida, for example, a home insurance company must offer hurricane deductible choices of $500, 2%, 5% or 10%. The $500 choice doesn’t have to be offered if the house is insured for more than $100,000.

Percentage-based deductibles, like 5%, are calculated based on the coverage amount you have for your dwelling, meaning house structure.

Hurricane deductibles can apply to wind and rain damage that are a direct result of a hurricane. For example, if rain comes in through a hole in the roof caused by a hurricane, the roof and water damage could be subject to a hurricane deductible.

In addition to hurricane deductibles, you might find that your home insurance company has a windstorm or wind/hail deductible. These apply to wind and/or hail damage not caused by “named storms” like hurricanes.

 

States That Allow Hurricane Deductibles

Currently, 19 states and the District of Columbia allow hurricane deductibles, according to the Insurance Information Institute:

  1. Alabama
  2. Connecticut
  3. Delaware
  4. Florida
  5. Georgia
  6. Hawaii
  7. Louisiana
  8. Maine
  9. Maryland
  10. Massachusetts
  11. Mississippi
  12. New Jersey
  13. New York
  14. North Carolina
  15. Pennsylvania
  16. Rhode Island
  17. South Carolina
  18. Texas
  19. Virginia
  20. Washington, D.C.

When Do Hurricane Deductibles Apply?

Hurricane deductibles usually trigger when the U.S. National Weather Service, National Hurricane Center or National Oceanic and Atmospheric Administration name a hurricane, tropical storm or windstorm. Naming a storm means that these organizations associate a number or a name to a specific storm

The trigger definitions for hurricane deductibles can vary depending on the insurance company and state. For example, in Florida, tropical storms do not trigger hurricane deductibles. A storm needs to be declared a “hurricane” by the National Hurricane Center of the National Weather Service. Florida also defines the duration for which a hurricane deductible be triggered as:

  • The trigger period starts when the National Hurricane Center starts a hurricane watch or warning in any part of Florida
  • The duration continues while hurricane conditions exist anywhere in Florida
  • The trigger period ends 72 hours after any hurricane watches or warnings in Florida expire

It’s essential to understand your home insurance policy’s trigger parameters so that you know when hurricane deductibles do and don’t apply.

What About Multiple Hurricanes?

Many Americans live in coastal areas that endure multiple hurricanes a year. That doesn’t mean that you have to pay a high, special hurricane deductible if your house gets hit by more than one hurricane in a year.

In Florida, for example, you’ll pay one hurricane deductible a year as long as you’re insured by the same company (or same company group). If a second hurricane does more damage, you’ll pay:

  • The rest of the hurricane deductible, if you didn’t pay the full hurricane deductible from the first storm
  • Or your regular “all perils” deductible if you have paid the full hurricane deductible this year

Hurricanes and Flooding

It’s important to point out that damage from flooding, including floods from a hurricane, aren’t covered by a standard home insurance policy.

You need a flood insurance policy to cover flood damage, no matter where you are in the country. Floods include storm surges, overflowing rivers and lakes, and floods from torrential rain.

Checking Your Deductible

Check your home insurance policy’s declarations page to see your deductibles, including any hurricane deductibles. If you discover a shockingly high deductible, call your home insurance agent to find out whether there are lower deductible choices—in exchange for a higher premium.

In some cases it may be possible to waive a hurricane deductible. NJM Insurance, for example, will eliminate a hurricane deductible in some parts of New Jersey if the home meets certain mitigation criteria, such as hurricane straps and anchor bolts.