Does Homeowner's Insurance Cover Hurricane Damage?

As a homeowner, you may be surprised to learn that your insurance does not typically cover damages caused by a hurricane. Standard insurance policies cover damage to and possible loss of your home's structure via such events as fire, lightening, hail and wind. Such policies do not include flood damage, however, which is the most likely outcome of a hurricane. Flood insurance must be purchased in addition to your standard homeowners insurance in order to adequately protect your home from hurricane damage.

Flood insurance is offered both by the federal government and by private insurance companies. The average premium for flood insurance isn't cheap, running $600 per year or more. In some coastal towns or southern states such as Florida, flood insurance can cost as much as $6,000 per year. Luckily, renters get a break when it comes to insuring their belongings from flooding; a renter's flood insurance premium starts at only $50 per year.

If there is a hurricane approaching your home and you find yourself without flood insurance, keep in mind that having this coverage added to your policy takes a minimum of 30 days. Thus, it pays to think of adding this coverage early, before any storm or hurricane is reported. In some cases, however, you may already have hurricane coverage on your home; many mortgage lenders and banks require hurricane coverage on a home that is located in a well-known flood plane before they will permit the mortgage loan to pass at closing.

Hurricane deductibles are typically calculated as a percentage of your home's insured value. For example, if your home is insured for $200,000 and you have a 5% hurricane deductible, this means that you will need to pay the first $10,000 in property damage and/or loss before your insurance policy kicked in. Therefore, if you live in an area known for its tropical storms, it is a good idea to maintain as low a deductible as possible.

If you find yourself paying too much money for your existing flood insurance coverage, ask your insurer if a discount exists for the installation of devices that reduce hurricane damage. Some anti-hurricane devices include storm shutters, laminated windows and wind-resistant doors. If you have several insurance policies (e.g., car, homeowners, flood) with the same insurance company, you may be able to bundle these policies and receive a multi-policy discount. Finally, since your insurance premium is dependent on your credit score, it pays to obtain a copy of your credit report and make sure there are no discrepancies or errors on it.