Hurricane season began on June 1, so it’s time to make sure you and your property are covered by a good insurance policy.
According to Ron Sachs, executive producer of the National Hurricane Survival Initiative, experts are predicting 2014 will be a modest year for hurricanes—but that’s no reason to be lulled into a false sense of security.
“I would liken it to crime,” Sachs said in a May teleconference. “Crime statistics may be down, but if people in your family are victims of a crime you know it only takes one.”
Ten of the 12 costliest hurricanes in US history have been in the last decade, according to the Insurance Information Institute. Together, they caused $135 billion in insured damages.
If you live anywhere near water, you could be vulnerable to hurricanes, even if the 2014 hurricane season winds up being mild. Don’t wait until it’s too late.
Here are four key things to remember about hurricane coverage:
1. Your homeowner’s insurance may not cover all hurricane-related damage.
Most homeowner’s insurance will only cover wind damage after a hurricane. Some policies contain a water damage clause, but in general they only protect against water that comes from the sky down. A storm surge resulting from a hurricane could cause extreme flooding, so be sure you have adequate coverage.
2. Flood insurance is important.
“Too often, we see people who don’t have adequate levels of flood insurance,” Brian Koon, vice president of the National Emergency Management Association and director of the Florida Division of Emergency Management, said in the teleconference. “If you just take a little bit of time, you can make sure you’re well positioned.”
Flooding caused by hurricanes is only covered by flood insurance, so it may be a good idea to have flood insurance whether you live in a designated flood zone or an inland area.
If your homeowner’s insurance provider does not offer flood coverage, you can buy it through an independent agent. The National Flood Insurance Program (NFIP) also provides coverage for up to $250,000 for the structure of your home and $100,000 for your personal possessions. Keep in mind that it takes 30 days for the NFIP policy to go into effect.
3. Your insurance may not cover everything.
Every insurance policy has its limits. Here are some things that are not usually protected by standard flood insurance policies:
- a detached garage
- the full cost of carpenters and materials to rebuild your home
- any personal items in the basement
- property outside the home, like patio furniture
- moisture, mildew, or mold that could have been avoided by the homeowner
- cost of living expenses, such as temporary housing
Ask about extra coverage if you want to avoid paying for these items if they’re needed as a result of or damaged by a hurricane.
4. Document everything in your home before and after you file a claim.
One of the best things you can do before a hurricane strikes is create a record of your home and all your belongings. Keep an up-to-date inventory as you acquire and get rid of property.
Start by taking photos and videos of everything you can before any damage occurs. Then, put the pictures in a fire-and-water-safe box and consider keeping copies off site. After a storm hits, photograph the same items again so your insurer can use the images as a reference. Organized records could make your claims process move along much faster.
It’s impossible to prevent a natural disaster, but with the right amount of insurance coverage and some prep work, you could help keep one from completely devastating your finances.