Understanding Hurricane Deductibles in Florida

November 15, 2024

Living in beautiful Bradenton, Sarasota, Parrish, Ellenton, Palmetto, and Lakewood Ranch has its perks: gorgeous weather, stunning coastlines, and a vibrant community.

But with the beauty of the “Sunshine State” comes the risk of hurricanes, making it essential for residents to understand their homeowners insurance—particularly hurricane deductibles.

In this blog, we’ll break down how hurricane deductibles work, what they mean for you, and how you can be prepared if a major storm heads our way.

What is a Hurricane Deductible?

What is a standard homeowners deductible?

A standard homeowners deductible is the portion of a loss that you must pay out of pocket before the insurance company begins to pay.

What is a “hurricane” deductible?

A hurricane deductible works the same as a regular deductible but allows a unique deductible amount for hurricane damage. Hurricane deductibles are typically a lot more money than standard homeowners deductibles.

Why do we Have Hurricane Deductibles?

Hurricane deductibles in Sarasota, Bradenton, and the surrounding area are usually quite a bit higher than standard homeowners deductibles. This puts more responsibility on the homeowners and help offsets some of the exorbitant losses insurance companies suffer during hurricanes.

How Does a Hurricane Deductible Work?

Standard deductibles are typically fixed amounts like $1,000 or $1,500. Hurricane deductibles are usually based on a percentage of the coverage you have on your home.

If your home is insured at a replacement cost of $500,000 and your hurricane deductible is 2%, you would need to pay 2% of $500,000.

$500,000 x 2% = $10,000 Hurricane Deductible

This means you would have to pay $10,000 before the insurance company would pickup the rest.

What Triggers a Hurricane Deductible?

A hurricane deductible is triggered once the National Weather Service has issued a hurricane watch or warning anywhere in the state of Florida. This typically lasts 72 hours after the last watch or warning has concluded.

Disclaimer: It’s important to read your policy carefully, as deductible triggers and time limits may vary between insurance providers.

Do I Have to use a Hurricane Deductible in a Tropical Storm?

Possibly. If the tropical storm never reaches hurricane status, then your hurricane deductible will not be triggered.

However, if a named hurricane turns into a tropical storm and then hits within 72-hours (or specified time-frame in your policy) from the end of the hurricane watch or warning, your hurricane deductible will apply.

Watch this video from ABC News. It details an unsuspecting customer who had damage in a tropical storm and how he had to pay his hurricane deductible.

Tips for Managing Hurricane Deductibles

If you live in Sarasota, Bradenton, Lakewood Ranch or any of the surrounding areas, here are a few tips to help you manage your hurricane deductible:

Review Your Policy Annually: Make sure you understand your hurricane deductible and check whether it still meets your needs each year. As property values change, so too may your deductible amount. If building materials and labor costs increase, the estimated replacement cost of your home might increase too. Since your hurricane deductible is tied to your home coverage, your hurricane deductible would also increase in such scenarios.
Set Up an Emergency Fund: Since hurricane deductibles can be high, it’s wise to have a savings specifically for your hurricane deductible. I know this is hard to do in Florida, but it’s an important thing to remember when reviewing your home insurance policies!
Consider Windstorm Coverage: In addition to hurricane deductibles, homeowners in Bradenton and Sarasota may also want to look into windstorm coverage for additional protection against tropical storms that don’t reach hurricane status.

Preparing for Hurricane Season in Bradenton and Sarasota, Florida

Residents in coastal Florida are no strangers to hurricane season, but being prepared can make all the difference. In addition to understanding your hurricane deductible, ensure you have:

Up-to-Date Home Inventory: This will make it easier to file claims if your property is damaged.
Storm Shutters or Impact Windows: Protecting your home with these features can help minimize damage.
Evacuation Plan: Know where you would go if a hurricane threatens your community. Know your evacuation zones.

Final Thoughts: Be Ready and Informed

Living in areas like Bradenton, Sarasota, Parrish, Ellenton, Palmetto, and Lakewood Ranch means enjoying the best of Florida’s lifestyle. However, it also requires an understanding of how to protect your property from hurricane damage. Knowing how hurricane deductibles work and preparing financially for them can help ensure you’re not caught off guard when the next big storm hits.

If you have questions about your current policy or want to explore different options, consider speaking with an insurance agent familiar with the unique needs of homeowners in our community. Stay safe, stay informed, and enjoy the peace of mind that comes with being prepared.