| If you are considering buying homeowners insurance | | | | homeowners insurance deductibles are a flat amount |
| in Florida, there are a few hurricane coverages all | | | | such as $500. When a loss occurs, the homeowner |
| buyers must be conversant with. Each state in the | | | | pays the first $500 and the insurance company pays |
| US has its own requirements and locality quirks each | | | | the rest of the claim. A hurricane deductible is based |
| person who wants to purchase homeowners | | | | on a percentage of the home insured value. This |
| insurance must know. For instance, earthquake | | | | percentage varies from state to state and some |
| coverage is handled differently in California than it is in | | | | deductibles are set by state law. |
| New York. Because Florida is a hurricane prone area, | | | | If you have a house insured for $200,000 in one of |
| each Florida homeowner should be aware of options | | | | these states and a 2% hurricane deductible, you will |
| in coverage that may pay for itself. | | | | pay the first $4000 and the insurance company pays |
| Here are a few coverages you must know when | | | | the rest of the claim. Some insurance companies |
| you want to discuss with your insurance agent: | | | | allow you to pay a higher insurance premium each |
| Extended Replacement Cost Coverage: | | | | year in exchange for a traditional deductible for |
| Extended Replacement Cost Coverage is the | | | | hurricane related claims. Washington DC, Alabama, |
| coverage that will allow you to repair or replace your | | | | Connecticut, Delaware, Florida, Georgia, Hawaii, |
| dwelling without consideration for depreciation. Should | | | | Louisiana, Maine, Maryland, Massachusetts, Mississippi, |
| you suffer a loss to your dwelling and you do not | | | | New Jersey, New York, North Carolina, Rhode Island, |
| have the replacement cost provision in your policy, | | | | South Carolina, Texas, and Virginia all have hurricane |
| the cost of repair whether small or large, will be | | | | deductibles. |
| calculated with depreciation. This could cost you far | | | | According to the Florida Insurance Council, 70% of |
| more out-of-pocket expense than the additional | | | | Florida homeowners have a 2% deductible applicable |
| insurance premium you would pay to be property | | | | to their hurricane coverage. This could prove to be a |
| insured. After a catastrophe, like a major hurricane, | | | | hefty dollar amount. For example, if your hurricane |
| building materials tend to become scarce. The larger | | | | policy limit is $300,000 with a 2% deductible, you will |
| the affected area, the more serious the problem. In | | | | be responsible for the first $6,000 of a hurricane loss. |
| addition to scarce building materials, the construction | | | | As an informed policyholder, you can plan beforehand |
| workers who rebuild and repair the structures | | | | and set aside money in an interest bearing account |
| become more difficult to secure and their rates rise | | | | to defray the cost of the deductible. |
| accordingly. | | | | Flood Coverage: |
| Extended Replacement Cost Coverage will pay for | | | | Generally, physical damage to your building or |
| the increased cost in materials and labor above and | | | | personal property "directly" caused by a flood is |
| beyond the policy limit. Insurance companies may pay | | | | covered by your flood insurance policy. For example, |
| as much as 20% above the policy limit, depending on | | | | damages caused by a sewer backup are covered if |
| the insurance company. It is in your best interest, as | | | | the backup is a direct result of flooding. However, if |
| a Florida homeowner, to talk to your agent about | | | | the backup is caused by some other problem, the |
| having this coverage endorsed onto your policy. | | | | damages are not covered. The standard |
| Hurricane Deductibles: | | | | homeowners policy does not include coverage for |
| Some states are regularly ravaged by hurricanes | | | | flood damage. Storm surge from a hurricane is also |
| including Florida and the entire eastern seaboard. | | | | considered flood damage and not covered by your |
| Insurance companies often sell homeowners policies | | | | homeowners policy. This coverage must be |
| in hurricane-prone areas with a "hurricane deductible" | | | | purchased separately through the Federal |
| that must be paid instead of the typical deductible. | | | | Government National Flood Insurance Program. If |
| These deductibles limit the insurance companies' | | | | you're not sure how to go about getting the |
| exposure in these high-risk areas. Typical | | | | coverage, speak with your insurance agent. |