Hurricanes can be devastating to property, and with climate change we can expect them to be more powerful than they were in the past (learn more in 5 Ways Climate Chance Can Affect Your Home Insurance Policy). Having adequate insurance in place to protect you from the financial devastation of a hurricane is no longer optional.
In this article, we'll give you a brief overview of the types of insurance you'll need in case a hurricane hits. And to save you time and trouble during the challenging times that follow a disastrous event, we'll go over what you need to do to make sure your claim is properly filed and you get the most value out of your coverage.
Three Types of Policies that Matter When a Hurricane Hits
Depending on where you live (state laws vary), you might need tree policies to be fully covered for hurricane damage.
Standard Homeowner's Policy and Windstorm Policy
The standard homeowner's policy will, in some states, cover you for wind damage. However, some states, including Texas, Louisiana, and Florida, will require you to get a separate windstorm policy to cover wind damage.
No matter which one you need, these policies will have a hurricane deductible in some high-risk states. It will typically be 2% to 5% of the value of your home. If you're in Florida, you can opt for a flat $500 deductible instead. But remember, it's always the case that the lower your deductible, the higher your premium.
Perhaps even more critical is a flood policy. A standard homeowner's insurance will cover you for some water damage situations, but they won't cover damage caused by flooding (see 5 Water Damage Home Insurance Scenarios to find out what is covered).
So, if your roof is blown off and the rain damages the interior of your house, your standard policy will likely cover this. But if a nearby creek overflows and floods your house, you will have to pay out of pocket to repair the damages unless you have a flood policy in place (for more advice on what to do before a hurricane strikes, see How to Prepare Your Home for a Hurricane).
After the Storm
Having the right insurance in place is an essential step. But there are still a few steps you need to take to make sure you get the most out of your coverage.
One of your duties as the insured is to mitigate damages. If you fail to take reasonable steps to prevent further damage, your insurer might not fully cover you. For example, if a falling tree branch punches a hole through your wall, you need to cover the hole with a tarp to minimize subsequent rain damage.
This is a step that you've hopefully started before the hurricane hit. When you first move into your home, and periodically after that (especially after major renovations), take an inventory of your possessions and any modifications to the house. Anything you own beyond the most inconsequential should be on the list along with its estimated value. In the case of high-value items, the source of the valuation should be included. And of course, photographing everything is an excellent idea.
Immediately after the storm, take another inventory. Photograph all damaged items and detail the extent of the damage in writing. Pairing this with your pre-hurricane inventory will give excellent evidence of your losses.
Submit Your Claim Promptly
If your home has been damaged by a hurricane, it's likely that many other homes in the area have also undergone similar damage. Because of this, your insurer or insurers will be swamped with claims.
Don't end up at the bottom of their list. Get your claims filed as soon as possible. In general, claims filed electronically are handled ahead of those submitted on paper, so consult the insurer's website for instructions on how to file electronically. If you're asked for additional documentation, hand it over as soon as possible.
Stay in touch with the adjuster assigned to your claim. If a stretch of time goes by and you haven't heard from them, call or e-mail to find out how things are going. With massive claims volumes going through after a storm, things can easily escape someone's notice, so don't let your claim languish (learn more in How to File a Claim that Gets Paid Sooner).
Anytime you talk or e-mail the adjuster, anyone else from the insurer, or other relevant professionals such as contractors, make a record of the conversation, including the date and what was discussed. Get their names, phone numbers, and e-mail addresses. If a dispute arises at some later point, these records might prove invaluable.
Get Repair Estimates
These bids should be by qualified contractors and they should be put down in writing. Make sure they are detailed, with labor and material costs itemized for each separate repair that is required.
But don't proceed with any repairs other than emergency ones necessary to mitigate damages until you have a settlement from the insurer.
If you are forced to make emergency repairs or to relocate, get and keep receipts for every expense.
If the insurer offers a settlement that you think is inadequate, you're not obligated to accept it. You have the right to negotiate better terms. If you feel that you are being treated unfairly, you can consult a lawyer or your state's insurance regulator.
What About Public Adjusters?
An adjuster is someone employed by your insurer and assigned to your loss. After evaluating your claim, they will offer you a settlement.
The adjuster's primary loyalty is to the insurance company, not to you. However, public adjusters are available for hire and they will work for you. Their rate is typically somewhere between 5% and 15% of your total settlement, with fees being negotiable. Some states also have caps on how much they can charge.
So, when is it worth paying the fee to use their services?
Public adjusters work mostly on larger, more complex claims. When you're dealing with hurricane-related losses, you're likely filing claims on two or three policies that might not all be with e same insurer. There are also potential complexities in determining, for example, whether the water damage to your home was caused by rain or by flooding. There might also be a number of forms you have to fill out.
With that level of complexity and headache, it might well be worth the public adjuster's fee to get someone with expertise in these matters on your side.
As a general rule of thumb, if you have a small claim with only one insurer involved, you can probably handle it yourself. And if your loss obviously exceeds your policy limits – the house is deemed a total loss, say – then you're likely able to deal with this yourself as well, since the insurer will simply pay the maximum amount.
It makes sense to get a public adjuster when the damage is extensive but does not obviously exceed your policy limits. This will especially be the case when multiple policies are involved.
But be aware that scam artists often take advantage of disasters. Before hiring anyone, be sure to get referrals, ask to see a business license, and check with the National Association of Public Insurance Adjusters. And if the adjuster requests fee up front, that's a red flag – public adjusters only collect after the settlement.
The Bottom Line
Be prepared with an inventory, move as quickly as you can in filing your claim, keep records, and negotiate. If you have a complex claim, consider enlisting a public adjuster. Getting things back to normal after a hurricane will take some time and effort, but having the right insurance in place and knowing what to do to collect the money you're owed will help speed things along.