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19 States With Mandatory Windstorm Deductibles

If you live in an area of the United States hard hit by extreme weather conditions, then you’ve probably come face-to-face with some pretty stiff homeowners insurance rates. Hurricanes, tornadoes and tropical storms all have the potential to tear your house a part, and if they do, you want to have an insurance company who you know will be in your corner. At CoverHound we have made it our priority to match customers with quality agents from well-respected insurance companies. Let us help you get your insurance in order before the next hurricane season strikes.

Why the Windstorm Deductible?

As highlighted in our article “19 States with Mandatory Hurricane Deductibles,” after the devastation and destruction left by 2005’s Hurricane Katrina struck in New Orleans, insurance agencies far and wide decided it was time to update their homeowners insurance packages.

Before Hurricane Katrina, homeowners insurance packages had what was the standard dollar deductible. A deductible is the amount of money an insurance policyholder must pay before the insurance agency pays for the claim. For example, say your deductible is $700, this means you must pay $700 worth of the insurance claim before your insurance company will pay for the rest of the claim.

Because Hurricane Katrina cost insurance agencies over $41 billion in insured losses, it was decided that homeowners insurance policies in the 19 states listed below (and the District of Columbia) needed to be re-written to replace the standard deductible with a hurricane and windstorm deductible.

Insurance companies replaced the standard deductible with the percentage deductible. The percentage deductible is based on your home's value, while the standard deductible was based on the dollar amount lost in the home by fire or theft in the home. So for example, if your home is insured for 400,000 and you have a 5 percent deductible, you will be paying $20,000 out of pocket before your insurance company will pick up the rest of the claim.

Is a Windstorm Something to Worry About?

According to the Insurance Information Institute (III), your insurance company will get to decide if it will cover certain wind damage scenarios. This means that even if you’re paying for protection, your insurance agency ultimately has the final say in whether or not they help to cover the damages. This is why it is very important to read the fine print, you will need to know what is covered under your insurance plan and what is not. The III also reports that between 2007 and 2011, windstorm and hail damage estimated for the largest chunk of home insurance claims. As of 2011, hail and windstorm damage accounted for 46 percent homeowners insurance claims. Judging by the numbers, windstorm damage is something to consider when purchasing your homeowners insurance protection.

Owning and taking care of a home comes with a ton of responsibilities, and one of those is homeowners insurance. Get your homeowners insurance rates at CoverHound today.

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