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Think Your Homeowners Insurance Covers You After a Hurricane? Think Again
The “Hurricane Deductible” And How It Affects You
The way home insurance works typically, especially if you have a mortgage, is that your lender requires you to insure the home, you make regular payments that must be kept up; in the event of damage, you make a claim, and the insurance company pays for repairs/replacement less your deductible. There are some exceptions. If you live in what is determined to be a flood zone, you may be required to carry flood insurance. In areas without flood insurance, you’re covered if you experience water coming into the home causing damage from the top down, say, a hole in the roof. You’re not if the water enters the room from the ground up. In most cases, you must pay a deductible; depending on your policy, it might typically range from $500–2,000. You pay the deductible; the insurance company pays the rest. That’s how it usually works, except during a hurricane.
Insurance companies have historically been hit hard, satisfying claims after major hurricanes. Their business model is based on collecting more money in premiums than they must pay. Some states like Florida, Alabama, Mississippi, Louisiana, Texas, Georgia, South Carolina, and North Carolina are regularly hit. The insurance companies that serve those states, along with…
