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Hurricanes

#1 reason for unpaid hurricane claims? Minor damage

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The 2016 hurricane season is a wrap, and you are probably seeing a few news stories detailing the number of insurance claims from Hurricane Matthew, as well as the  insurance claims from Hurricane Hermine. More than 87 percent of claims from Hermine are closed; almost 78 percent of claims from Matthew are closed. But the news headlines do not focus on that positive note. Instead, they point out that about a third of claims from the storm are unpaid. You have to read down six paragraphs in the newspaper story to find out why. I’ll tell you in the second paragraph below.

There are two primary reasons claims are closed without being paid:

  1. Storm damage was minor and under the amount of the hurricane deductible, or
  2. The damage was not covered by the policy.

Everyone knows headlines don’t tell the whole story. They are designed to attract attention and are not written by the reporter, but by someone looking to grab the reader.  To be truly informed, we have to look beyond the headline, true?

Insurers have encouraged policyholders to report storm damage even if it is minor because Florida has a calendar year hurricane deductible. That means storm damage from more than one storm in a season counts toward the deductible amount.

Damage not covered from the storms would include falling trees that do not damage an insured property, such as your house or fence.

Now you know rest of the story.

Matthew Recovery: 40,000 insurance claims so far

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As of this morning, there have been nearly 40,000 insurance claims filed due to damage from Hurricane Matthew. Those numbers will surely rise in the coming days as people continue to find damage to their property related to the storm that hit Florida a mere four days ago.

The Florida Office of Insurance Regulation released Matthew claims data on October 12.  About 90% of the claims were for residential property damage. So far, there have been 1,800 flood claims reported by people with flood policies through the National Flood Insurance Program, and 28 claims for private flood insurance, which is coverage outside the government program.

Matthew hits home

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Hurricane Matthew is slowly advancing up the coast, bringing with it winds in excess of 100 mph and the potential for incredibly powerful storm surge. As Floridians, we hang tough, but know when to get out of harm’s way and let emergency responders do their jobs.

To help you prepare and fall back, and then regroup/recover when it’s safe to return to your homes and places of business, we offer the following key preparedness and recovery links.

Keep this list handy. And please stay safe, everyone.

And here are some useful articles and how-to videos from the I.I.I.

Article: Preparing an Effective Evacuation Plan

Article: Including Your Pets in Evacuation and Disaster Planning

Video: Evacuation: How to Get Organized

Video: Evacuation: The 10 Minute Challenge

Video: Hurricane and Disaster Preparedness
Follow us on Twitter @InsuringFLA for the latest updates on Hurricane Matthew and insurance related topics.

 

Massive Matthew: This is not a drill

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Florida Governor Rick Scott issued an executive order yesterday putting the entire state on notice that ill winds are coming. The National Hurricane Center continues to update its advisories, and hurricane watches and warnings are in effect. A warning means take immediate action. This is not a drill.

The hurricane drill may be a distant memory for some. Here’s hoping those who had experience with the storms of 2004 and 2005 provide quick tutorials, and the lessons are put into practice. If you are in an evacuation zone and in an area where a hurricane warning has been issued, get on the road — while you still can. Don’t fight with the authorities over your right to stay. Don’t fight with the wind because it’s stronger than you. The (often) arduous journey of your flight to safety is a better tale to tell than a first-person account of the physical mess Matthew is expected to deliver.

Be safe. Be Ready, Florida.

How named storms matter to property insurance

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Late summer is the peak time for hurricane season. And as if on cue, there’s a few storms brewing out in the Atlantic. It’s too early to tell if they will impact Florida, but it is not too early to prepare as if they are.

Review our hurricane season insurance checklist. First on the list is probably the most important: Make certain to have enough coverage to completely rebuild your home in the event it is severely damaged or destroyed. This means sufficient insurance protection to rebuild your home and replace all its contents.

Don’t confuse the real estate value of your home with its insurance cost. Typically, the older your home the bigger the gap between what it costs to insure it, which is the rebuilding costs, and what you would get if you sold it.

Check hurricane deductible, have a plan to fund it

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Let’s start with the most important tip about deductibles: You should NEVER select a higher deductible than you can afford.

Big deductibles reduce the amount you pay for insurance. But the higher the deductible, the more you pay out of pocket when things go wrong. That means selecting a hefty deductible is only smart in a Perfect World. And, while we all wished we lived on that planet, all kinds of disasters happen – manmade and natural – to mess with it, at least temporarily.

You have two deductibles on your homeowners insurance: one is for hurricanes and the other is for everything else. The “everything else” deductible is for things like a fire, lightning strike or water damage, to name a few. It is usually a flat dollar amount, such as $1,000. The hurricane deductible is, obviously, for hurricanes – and for homes valued over $100,000, it starts at 2 percent of what the home is insured for, which is what it would cost to rebuild it. So, if the house is insured for $250,000, a 2 percent deductible would be $5,000.

In Florida, you can select up to a 10 percent deductible. And, some people decide to do that, which is fine if you have a plan to save that amount of money and keep it secured for when the wind blows.

Here is a handy factsheet on how insurance deductibles work in Florida. The Florida Office of Insurance Regulation explains when hurricane deductibles go into effect and how long they last. Regulators also require this notice on the declarations page of every homeowners policy, in boldface type of at least 18 points:

“THIS POLICY CONTAINS A SEPARATE DEDUCTIBLE FOR HURRICANE LOSSES, WHICH MAY RESULT IN HIGH OUT-OF-POCKET EXPENSES TO YOU.”

Now is the time to verify that the deductible amount you chose makes sense for your circumstances.