For businesses and homeowners alike, Hurricane Laura was yet another stark reminder of the power and fury of windstorms. With sustained winds as high as 95 mph in Lake Charles, LA, and gusts recorded as high as 150 mph in other places, Laura caused 59 deaths and nearly $9 billion in damage in Texas and Louisiana.
To be prepared for a severe windstorm, homeowners and business owners need two things: an emergency response plan and the right insurance coverage.
Unfortunately, when it comes to insurance, too many homeowners and business owners make a critical mistake – assuming their standard homeowner’s or commercial property insurance will automatically cover damage caused by windstorms.
Sometimes it will, but sometimes it won’t. Let’s look at some facts.
In 19 states and coastal areas, Wind Insurance is a separate policy, including in Texas. However, for some people, their standard homeowner’s insurance policy covers their home and personal belongings from wind and hail damage. But even if your policy includes this coverage, it will probably have a deductible.
Things are different if you live in a high-risk coastal community. In those areas, windstorm damage is usually excluded from homeowner’s policies altogether. That means you’ll need separate windstorm insurance to specifically cover wind and hail related damage. In fact, wind insurance is a separate policy from homeowner’s insurance in 19 states, including Texas.
Where do you find windstorm insurance?
If you live close to the coast and can’t get wind and hail coverage on the private market, you may be able to get coverage through your state's Beach and Windstorm Plan. A good example is Texas’s TWIA (Texas Windstorm Insurance Association), which provides wind and hail coverage for 14 counties along the Gulf coast. The Texas Fair Access to Insurance Requirements Plan Association (FAIR Plan) also provides residential property insurance to qualified homeowners who can’t get insurance elsewhere. The FAIR Plan operates statewide but doesn’t provide wind and hail coverage in areas that are eligible for inclusion in the TWIA.
Wind damage deductibles come in two types: hurricane deductibles, which apply solely to damage from hurricanes, and windstorm or wind/hail deductibles, which apply to all types of wind damage. These are generally percentage deductibles based on your home’s value. For example, if your home is insured for $200,000 and your wind insurance deductible is 5 percent, your deductible is $10,000. In Texas, a windstorm deductible applies to windstorm and hail damage from any type of windstorm, not only named storms or hurricanes.
Here's a tip: You may be able to save money on wind insurance by implementing certain upgrades and features that better protect your property from wind damage, such as roofing using FORTIFIED standards.
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Commercial Property Insurance
Just like homeowners, too many business owners are unpleasantly surprised to find out after a windstorm that they’re not covered for the damages. Your commercial property policy’s wind coverage can vary significantly depending on your location, the terms of your policy and the specific needs of your business. That’s why it’s so crucial to work with an insurance provider you trust and always know what’s in your policy.
The insurance industry is getting better at predicting climate-related risks, increasingly using models and analysis to help their customers predict, prepare for and protect against windstorm risks. But commercial property insurance premiums are still going up, while coverages are narrowing. With climate change bringing about more severe weather patterns, that trend isn’t likely to change soon.
Want to know if you have adequate coverage to protect your home or business from a severe windstorm? Contact our insurance professionals today.