Named Storm Insurance Deductible

Named storm insurance deductibles are now available for Mobile and Baldwin County! A named storm is any storm given a name. Usually, this applies to hurricanes. If for some reason, a non-hurricane storm is given a name, the named storm deductible would apply.

In 2004, Hurricane Ivan hit the Gulf Coast. In 2005, Hurricane Katrina hit. Most insurance providers sustained great losses. With fear that more hurricanes would come, the insurance providers stopped wind coverage in Mobile and Baldwin Counties. During that time there only remained a few insurance providers who were willing to write wind insurance; namely AIUA and Lloyds.

Percentage Deductibles

In most normal cases, homeowners insurance has 2 deductibles; a wind deductible and an all other peril deductible (AOP). If wind damages the house, you must meet the wind deductible. If anything else damages the house, the AOP applies. Most wind deductibles are a percentage multiplied by the value of the house. Those percentages are 2%, 3%, 5%, and sometimes 10%. For example, if a house is insured for $100,000 and the wind deductible is 5% (that means 100,000 * 5%), the wind deductible would be $5,000. Therefore, a homeowner must have over $5,000 in wind damage to make a claim. If they had $6,000 in wind damage, they would receive $1,000 in insurance.

Wind Deductible vs. Named Storm Deductible

What’s the difference between the normal wind deductible and a named storm insurance deductible? The normal wind deductible applies to any form of wind. A named storm deductible only applies to storms with a name. This is great! Why? Let me use the $100,000 house for an example:

• Named storm deductible 5% = $5,000
• Wind deductible = $1,000
• AOP = $1,000

Under these deductibles, if I had a fire, I could file for a claim if the damage was over $1,000. If there was a popup thunderstorm that damaged my house, I could make a claim if the damage was over $1,000. If a hurricane hits me, I would need $5,000 in damage to file a claim. It makes sense to have a named storm deductible! After all, if hurricanes sent the insurance companies running, higher named storm deductibles would offset that problem. From 2005-2015, the Gulf Coast has not had a hurricane.

Hurricane Deductibles

Hurricane deductibles only apply to hurricanes. For example, Hurricane Andy is a category 1 hurricane. When it hits landfall, it becomes Tropical Storm Andy. If it damages your home as a tropical storm or tropical depression, the hurricane deductible would not apply. Currently, Heritage Insurance does not provide hurricane deductibles.

Get a quote today! Heritage Insurance also provides wind only insurance!