How Does Hurricane Insurance Work?

Hurricanes suck. They damage property, wreck businesses, destroy livelihoods, cause billions of dollars in destruction and ultimately kill.

Hurricane Ida was no exception. A Category 4 hurricane, Ida was one of the most powerful storms to hit the United States’ coast. It slammed into Louisiana and Mississippi on August 29, 2021, knocking out power to 1 million residents. Authorities say it will be weeks before power is restored.

Rescue efforts are still underway to save as many people as possible. At least six people have been killed so far, with this number expected to rise.¹ And insurance companies are expecting to pay out claims in the range of $15 to $30 billion due to building costs rising so sharply.²

If you’ve been affected in any way by Hurricane Ida, you probably have a ton of questions about your home or property. And hurricane insurance is suddenly top of mind. You want to know if you’re protected, or maybe how to file a hurricane or flood insurance claim.

We’re here to help. We’ll dig into everything you need to know about hurricane and flood insurance so you can protect your biggest investment—your home. (And if you’re just looking for tips on preparing for the next hurricane, check out our handy Hurricane Preparedness Checklist.)

What Insurance Covers You for Hurricane Ida?

In the insurance industry, the term “act of God” refers to any event, like a natural disaster, that occurs from natural causes and can’t be avoided through prevention or exercising caution. But many people don’t realize that not all acts of God are covered under homeowners insurance. Depending on where you live, you’ll need to have an extra layer of protection in place.

If you live in a coastal state, and you don’t have wind insurance coverage or a separate hurricane deductible, your homeowners insurance policy won’t cover hurricane damage. Unfortunately, you might be looking at a lot of out-of-pocket costs depending on the damage to your home. FEMA might offer some kind of assistance, but you probably shouldn’t count on it.

If you know you added these to your policy, you’re probably protected. (More in a second on filing a claim.)

If you live in a non-coastal state, you can potentially breathe a sigh of relief. Homeowners insurance typically covers non-flood-related damage due to hurricanes.

If you’re wondering about flood damage, you’ll only be protected if you specifically added flood insurance to your homeowners policy through the National Flood Insurance Program (NFIP) or a private insurance carrier.

Sadly, many mistakenly assume their normal policy covers flooding. Then when a flood hits, they’re left holding the bill. Not good. This is one reason it’s so helpful to have a trusted and independent insurance agent in your corner who can help you understand your policy. And if you're not sure what kind of homeowners insurance coverage you currently have, check your insurance declaration page to see a helpful breakdown.

What Is Hurricane Insurance?

First, there’s not actually a policy called “hurricane insurance.” Instead, it typically comes in the form of wind insurance or flood insurance. These extra layers of insurance can be added to a standard homeowners policy.

Nineteen coastal states offer wind insurance coverage or what some carriers call “hurricane deductibles”—Alabama, Connecticut, Delaware, Florida, Georgia, Hawaii, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas, Virginia and Washington DC.³

Protect your home and your budget with the right coverage!

Rather than typical “dollar” deductibles, hurricane deductibles are based on a percentage of the insured property to minimize possible losses for the insurance company. So if your home is worth $250,000, and you have a 10% hurricane deductible, you would need to pay $25,000 out of pocket before your insurance company would cover any repairs for hurricane damage. Certain states do give you the option of paying a higher premium for a traditional dollar deductible. But it can depend on how close your house is to the shore.

Does Homeowners Insurance Cover Hurricane Damage?

Again, the short answer is no. You’d think the typical homeowners insurance policy would protect your house, belongings and property from hurricanes and flooding, but this just isn’t the case.

And if you’re renting, your renters insurance also doesn’t cover damage to your stuff from a hurricane or flooding—although most renters insurance does cover wind damage.

Here’s a summary of what’s typically covered by your homeowners insurance policy or add-ons:

Usually Covered by Home Insurance:

• Wind damage (except if you live in a coastal state)
• Temporary relocation expenses like food and lodging
• Flooding caused by water coming through a hole in the roof
• A lightning storm destroys your favorite oak tree (up to $500)
• Food spoiling in the freezer due to a power outage caused by a hurricane

Usually Covered by Wind Insurance:

• Home damage caused by wind-driven rain (in coastal states)

Usually Covered by Flood (or Hurricane) Insurance:

• Water damage to your home from flooding
• Water-damaged appliances due to a flood
• Furniture destroyed by flooding

Usually Covered by Car Insurance:

• Hail damage to the hood of your car

What If I Have Flood Damage?

Around 90% of all natural disasters involve flooding.⁴ But only about 27% of homeowners have flood insurance.⁵

If your home has flood damage, here’s a summary of what you can expect regarding your insurance coverages:

Usually Covered by Home Insurance:

• Temporary relocation expenses (food and lodging)

Usually Covered by Flood Insurance:

• Water damage to your home caused by flooding
• Water-damaged appliances due to a flood (if you live in a non-coastal state)
• Furniture destroyed by floodwaters (if you live in a non-coastal state)

Usually Covered by Car Insurance:

• Flood damage to your car

Not Usually Covered by Insurance:

• Finished basements ruined by floodwater
• Landscaping washed away by flooding
• Sewage backup into the house (ask your agent or insurance company about purchasing a separate policy for this)

Tips on Filing a Homeowners Insurance Claim

If you had hurricane insurance in place when Ida struck, great job! Maybe you’re just wondering how to file a claim. We’ll walk you through a few tips.

First, keep in mind that if your damages are less than your deductible (or just a few hundred bucks more), it’s probably not worth going through the trouble of filing a claim for a small payout—if you get one at all. And when you file a claim, there’s a chance your carrier will increase your premiums. So do the math before you start filing a claim to see if it even makes sense.

1. Call your insurance company.

Start by calling your insurance company and talk to them about your situation. They’ll set you up with someone called an adjuster who will come out and inspect the damage. Expect to fill out some forms or give them some more information to start the filing process.

2. Call your mortgage lender.

If you own your house outright, you can skip this step. But if you do have a mortgage, you’ll want to reach out to the lender. They’ll be part of the settlement process so the sooner they’re involved, the better. They often are the ones who hold the money in escrow and dish it out in increments to make sure the repairs are actually being done.

3. Take pictures of the damage.

This step is pretty straightforward. Do your best to document, take notes on and take pics of everything that’s been damaged or destroyed. Don’t be afraid to take video of certain areas too. This will give an even better picture of what happened. Take an inventory of things that were destroyed or damaged. Be as detailed as you can.

4. Make some repairs if possible.

In some cases, a few temporary repairs can make a big difference in preventing further damage. And keep those receipts since your insurance company may reimburse you for the repairs.

5. Prep for the adjuster.

Write down everything that happened so the adjuster will have a written report along with the photos, videos and other documentation. The goal is simply to make sure they don’t accidentally underestimate how much the repairs will cost. It’s your house, after all, and you’re the one with the most at stake. Don’t cut corners when it comes to the paperwork.

Also, follow up with the adjuster and the insurance company to make sure nothing slips through the cracks. And don’t assume the adjuster knows the exact ins and outs of your policy. Adjusters often have huge caseloads and can easily make mistakes. You should be an expert on your policy.

6. Record every detail.

Keep a thorough timeline of the process. This means documenting all phone conversations, the names of people you spoke with and saving receipts. Having a lengthy paper trail is the best way to ensure you get the settlement money you’ll need. Be sure to ask the contractors to detail everything that’s being done.

7. Look at the settlement.

After everything is reviewed, your insurance carrier will send you a settlement offer. Look it over. See if anything weird jumps out at you. And realize that once you accept the offer, you won’t be allowed to contest it. If the offer doesn’t look right, you can hire a public adjuster to act as a third party and dispute it.

If your claim is denied, look at the fine print of your insurance policy. See if you have a case to appeal the decision.

Okay, that was a lot of information. But following these steps will give you a leg up on making sure your house is repaired and you get that insurance money you deserve.

Our Agents Are Here to Help

Insurance is a tricky thing, and it can be really hard to understand the process or your policy.

If you’ve been affected by Hurricane Ida in any way, reach out to one of our trusted and independent insurance pros, who are part of our Endorsed Local Providers (ELP) program. They have the heart of a teacher and truly care about handling whatever needs you might have.

Connect with an ELP today to check out your options.