Complete Guide to Hurricane Insurance

A homeowners policy will not cover all hurricane-related damage to your home.

Your home is not just where your heart is, but also where your money is. It’s undoubtedly your most precious investment, therefore you have homeowners insurance to protect it.

Even the greatest home insurance will not cover all types of hurricane damage. If you live near the shore, understanding what your home’s policy will and will not cover is critical to obtaining the appropriate storm insurance.

What is hurricane insurance?

Technically, there is no single policy designated as “hurricane insurance.” Instead, you’ll need to insure your property against two major causes of hurricane damage: water and wind.

Depending on where you live, you may need to purchase these individual policies to secure adequate hurricane coverage:

• Flood insurance. Floods, including those caused by storm surges, are not covered by most homeowner insurance policies. To obtain coverage, you will need flood insurance.
• Windstorm insurance. Windstorm damage is not covered by homeowner insurance coverage in coastal zones of some hurricane-prone states. If you live in one of these zones and need coverage, purchase a separate windstorm insurance policy.

Does homeowners insurance cover hurricane damage?

Flooding is normally not covered by a conventional homeowners insurance policy, although it can be purchased individually through the National Flood Insurance Program or on the private market. Many major insurers offer flood insurance through a partnership with the NFIP, so you can likely get it from your home insurance agent.

In most states, standard homeowners policies cover damage caused by wind, including hurricanes. However, if you live in a high-risk coastal area, you may need to purchase separate windstorm insurance, either through your insurance company or a state-run insurance pool. Wind coverage may also be available as a rider to your current policy. Windstorm insurance covers damage from any strong wind, not just hurricanes.

Where to get windstorm insurance

The groups listed below provide windstorm insurance coverage—and, in many cases, hail damage coverage—to homeowners who live in high-risk coastal locations and are unable to get it elsewhere. This insurance may take the form of a standalone wind policy or a homeowners policy that includes wind coverage.

• Alabama: Alabama Insurance Underwriting Association.
• Connecticut: Coastal Market Assistance Program.
• Florida: Citizens Property Insurance Corporation. 
• Georgia: Georgia Underwriting Association.
• Louisiana: Louisiana Citizens Property Insurance Corporation.
• Maryland: Maryland Joint Insurance Association.
• Massachusetts: Massachusetts Property Insurance Underwriting Association.
• Mississippi: Mississippi Windstorm Underwriting Association.
• New Jersey: New Jersey Insurance Underwriting Association.
• New York: New York Property Insurance Underwriting Association.
• Rhode Island: Rhode Island Joint Reinsurance Association.
• South Carolina: South Carolina Wind and Hail Underwriting Association.
• Texas: Texas Windstorm Insurance Association.
• Virginia: Virginia Property Insurance Association.

Does renters insurance cover hurricane damage?

Most renters insurance policies do not cover water damage to your belongings, whether caused by a hurricane or another storm. If you’re renting a house or first-floor apartment near the ocean, flood insurance may be worthwhile, but it may be difficult to obtain for a basement unit. 

Most renters insurance policies include wind damage, while it is often excluded in high-risk areas. If wind damage is a problem, check your policy to ensure you are covered. If not, contact your insurance company or agent to see if you can include this coverage in your policy.

Windstorm, named storm and hurricane deductibles

A homeowner’s insurance deductible is the amount deducted from your insurer’s payout following a claim. Say you have a $1,000 deductible and a kitchen fire causes $5,000 in damage to your home. The insurer would pay $4,000 for the damage, with you covering the remaining $1,000.

If you reside in a coastal area, your insurer may make you pay a supplementary hurricane, named storm, or windstorm deductible in addition to your normal deductible.

Although these deductibles seem comparable, there are significant differences:

• Windstorm deductible: Sometimes called a wind/hail deductible, this applies to damage from hurricanes, tornadoes or other strong winds.
• Named storm deductible: This type of deductible typically applies if your home is damaged by a named storm as designated by the National Weather Service or the National Hurricane Center. A tornado or other severe windstorm would not trigger this type of deductible.
• Hurricane deductible: A hurricane deductible is generally triggered only when a storm has high enough winds to be categorized as a hurricane (rather than a tropical storm or depression). Although all hurricanes would result in a named storm deductible, not all named storms are powerful enough to become hurricanes. So, if you have a hurricane deductible and the storm that causes damage to your home has tropical storm winds, you will pay your all other risks deductible.

Home insurance deductibles are sometimes a fixed financial sum, such as $1,000, whereas wind, named storm, and hurricane deductibles are typically a percentage of your home’s insured value. They typically range from 1% to 5%, but they may be greater in high-risk coastal areas. If your home is insured for $500,000 and you have a 5% wind deductible, your insurance company will remove up to $25,000 from your payment if you file a claim.

Check with your agent to ensure you understand the deductibles that apply to your policy and under what conditions they may be triggered.

The following 19 coastal states and Washington, D.C., allow insurers to charge special deductibles for hurricane damage, according to the Insurance Information Institute.

Deductible percentages vary by state and insurance company. For example:

• Alabama. The Alabama Insurance Underwriting Association offers wind/hail/hurricane deductibles of 1%, 2%, 5%, and 10%.
• Florida. Insurers must offer hurricane deductibles of $500, 2%, 5%, and 10%. Deductibles can sometimes surpass 10%. The state offers a “single season hurricane deductible,” which means you only have to pay one hurricane deductible during a particular hurricane season, even if your home is affected by several storms. Once you have reached your hurricane deductible, all further storm claims will be subject to your policy’s all other risks deductible, which is often a flat cash amount.
• Massachusetts. Some insurance companies require wind deductibles on individuals who live in coastal areas. These could be fixed dollar amounts or percentages, depending on how much coverage you require and how close you are to the beach.
• New York. Wind or hurricane deductibles often vary between 1% and 5%. Hurricane deductibles may be required if you live in a specified area. If you have one, your insurer must include a dollar number on your home insurance declarations page.
• Pennsylvania. Hurricane and storm deductibles for homeowners policies typically range from 1% to 5%.
• Rhode Island. A windstorm deductible on a homeowners policy cannot exceed 5% of the insured value.

How much is hurricane insurance?

The average annual cost of homeowners insurance in the United States is $1,915, according to the ReliableInsurance rate study. ReliableInsurance found that the typical federal flood insurance policy costs around $819 per year. On average, hurricane insurance costs $2,734 per year.

Some coastal homes will need to add wind coverage to their flood and homeowners insurance to be completely covered for a storm, which can be costly. For example, the Texas Windstorm Insurance Association reports an average yearly residential premium of $2,000.

Hurricane insurance is substantially cheaper if you rent. The NFIP provides flood insurance to renters for as little as $99 per year, while the average annual cost of renters insurance is $148, according to ReliableInsurance pricing research.

Your personal costs will vary depending on where you reside, the quantity of hurricane coverage you require, and the deductibles you select.

Tips for buying hurricane coverage

• Whether you’re purchasing home, flood, or windstorm insurance—or all three—make sure you have enough coverage to cover the full cost of reconstructing your home and replacing your belongings. Your insurance agent can help you determine the appropriate amount.
• Do not put it off. Flood insurance products normally need a 30-day waiting period between the time you purchase and the time coverage begins. In addition, if a storm is expected, insurers usually do not adjust your coverage.
• When your policy comes up for renewal, remember that you may be able to save money by comparing house insurance quotes to discover a lower rate for the same coverage.