Ahead of summer storms, check homeowners policy for weather coverage

As spring warmth takes hold, homeowners may want to make sure they’re prepared for the severe weather that will likely soon follow.

That preparation should include checking your insurance coverage.

Whether you live in an area prone to hurricanes, tornados, flooding, hail, wildfires or severe storms — all of which are becoming more prevalent amid a warming climate — it’s important to know which types of weather-related damage your homeowners insurance covers, excludes or charges a separate (and likely higher) deductible for.

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“Take time to understand how the policy [covers] severe weather and natural disasters,” said Steve Wilson, senior underwriting manager at insurer Hippo.

Tornado season already is under way, and the Atlantic hurricane season starts June 1 and runs through Nov. 30. Meanwhile, much of the western part of the U.S. is experiencing drought conditions, which is conducive to wildfires.

Depending on where you live and the weather that’s typical for that area, your policy may provide coverage for some of the more location-specific events, and state law often dictates what’s required of policies offered in their jurisdiction.

It’s worth noting that in Florida, the insurance industry is in crisis, largely due to rampant roof replacement schemes that result in litigation and have cost insurers an estimated $3.4 billion in underwriting losses over the past two years, according to Mark Friedlander, spokesman for the Insurance Information Institute. 

Florida homeowners in 2021 saw their premiums increase by an average of 25%, compared with 4% for the rest of the U.S., Friedlander said. The institute projects average increases of 30% to 40% this year, with many households seeing increases of 100% or more.

Regardless of where you live, here’s what you should review about your weather-related coverage.

While many weather-related events are covered under the standard part of your policy, some fall under a different section that comes with a separate deductible.

If you live in a state along the East Coast or Gulf of Mexico, there’s a good chance your policy has a hurricane deductible. Likewise, in states more prone to wind-related events — i.e., tornadoes — you’re likely to have a wind deductible.

Either way, those amounts typically range from about 1% to 5% (with a minimum $500) depending on the specifics of your insurance. Some homeowners might opt for an even higher deductible if it’s available. 

Be aware that for those percentage-based deductibles, the amount is based on your insured value, not the damage caused.

So if your home is insured for $500,000 and you have a 5% hurricane deductible, you’d be responsible for covering the first $25,000 regardless of the total cost of the damage. 

Also, earthquakes are not covered by standard homeowners policies, even in quake-prone California (you’d have to purchase separate insurance). Nor, typically, are other types of earth movement (i.e., landslides, sinkholes).

Flooding has become an increasing risk for homeowners as sea levels rise and storms grow larger. Yet just 15% of homeowners are insured to protect against flood damage.

“One of the most important policies to consider for hurricane protection that can be overlooked is flood insurance,” Wilson said.

If you’re in a high-risk flood zone, your mortgage lender likely requires you to have it. Yet 1 in 4 flood claims come from homeowners outside of those areas, according to the government’s National Flood Insurance Program.

You can get coverage through either a private insurer or the federal program (which is how most homeowners get a policy). There are exclusions and limitations on what is covered, however. And, outside of a few exceptions, policies take 30 days to become effective.

The average yearly cost is $985, although that can vary widely. The Federal Emergency Management Agency recently updated flood maps to more accurately reflect risk, which is causing premiums to rise for some homeowners and fall for others.