Hurricane deductible

What it means

Many coastal policies have two deductibles: a regular one for fire, theft and similar losses, and a hurricane or windstorm deductible. The Insurance Information Institute says hurricane deductibles are often a percentage of the home’s insured value. A home insured for $300,000 with a 5% deductible means the first $15,000 of a hurricane claim comes out of pocket. The III counts 19 states and Washington, D.C. with hurricane deductibles.

Florida sets rules in statute. Before issuing a policy, insurers must offer hurricane deductibles of $500, 2%, 5% and 10% of the dwelling limit, with some exceptions (§627.701). The hurricane deductible applies on a calendar-year basis to all covered hurricane losses.

Why it matters to your claim or your bill

A percentage deductible can be large enough to change whether a claim is worth filing. Check your declarations page for both deductibles and how they are triggered. In Florida, if you already met part of the hurricane deductible earlier in the year, the insurer may apply the greater of the remaining hurricane deductible or your regular deductible to a later storm (§627.701), so keep records of each loss. Be wary of anyone offering to cover it. In Florida, a contractor waiving or rebating a deductible commits a felony. See restoration scams and red flags.