It's Hurricane Season. Are You Protected?

Welcome to another hurricane season!  Last year put property insurance coverages for named storms and windstorms (Derecho, anyone?) to the test.  Make sure you are aware of what your windstorm insurance may not cover: 

High Deductibles for Named Storms: 

There are always higher deductibles for named storms, often a percentage of the property’s insured value (e.g., 2-5%). This can lead to significant out-of-pocket costs, especially for businesses underestimating the financial impact.  

Flood and Storm Surge Exclusions: 

Your standard property coverage form WILL NOT cover flood or storm surge.  This is true for almost all property forms and equipment floaters.  You will need separate coverage for this and it is limited to set amounts.  Know whether your property is subject to flood risk and make sure to take steps to protect your property from flood BEFORE the storm. 

Business Interruption Coverage Limitations: 

Most policies require physical damage to your structure to trigger the business interruption coverage.  An evacuation order by a civil authority or a wide-spread power outage that lasts for weeks will not trigger coverage (this coverage can be purchased).    

Underestimating Replacement Costs: 

Most property policies have a coinsurance requirement that requires you to carry enough limits to cover at least 80% of the total replacement.  The severe price escalations we have experienced in recent years have left many property owners under-insured.  Check your building values and consider what it would cost to replace today.  What you bought it for or built it for ten years ago is almost surely undervalued.   

Understanding your property coverage is an important part of being prepared for hurricane season.  Reach out to our team at Adams Insurance Service if you need to adjust your property values or explore changes in coverage to address named storm risks!