The damage caused by Hurricane Laura is a powerful reminder that the tropical storm season has arrived for people who live along the Texas-Louisiana-Florida Gulf Coast. Having the right kind and amount of insurance coverage can be the difference between suffering a financial catastrophe and recovering from hurricane damage in a relatively brief time.
Most residents of states on the East Gulf Coast or the Gulf of Mexico have insurance policies that protect their homes against wind and water damage. These policies usually contain an important limitation on coverage: a hurricane deductible. This deductible refers to an amount of damage that must be incurred by the homeowner before the insurance company will pay amounts to repair storm damage. Many policies also contain wind/hail deductibles, and some polices contain both kinds of deductibles.
The amount of these deductibles usually depends upon the market value of the home. If a policy contains a 2% hurricane deductible and the house is insured for $200,000, the home owner must pay $4,000 of the loss. If the deductible were 5%, the deductible amount would be $10,000. Most insurance experts recommend that a home owners’ policy cover the replacement cost of the building, not its fair market value.
Anyone who has questions about the extent of coverage provided by their homeowners’ policy may wish to consult an attorney with experience in handling hurricane damage claims. A knowledgeable attorney can provide helpful advice on the extent of coverage in a specific policy and the amount of deductibles for which the homeowner may be liable. If an insurance company appears to be taking too long to process a claim or if it denies the claim without proper justification, an knowledgeable attorney can provide advice on available legal remedies.