Is Bertha Headed Your Way? Here’s How To Insure For A Hurricane

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It’s hurricane time again.

The first official hurricane of the 2008 season, Bertha, is gunning at 75 miles per hour across the Atlantic Ocean. As of Monday, July 7, Bertha is located in the middle of the ocean, near the Leeward Islands. (And, fortunately, the Weather Channel predicts the East Coast is safe for now, since Bertha is likely slow her speed before hitting land.)

Even if Bertha decides not to blow through any U.S. neighborhoods, experts are already predicting a "well above-average" hurricane season (which is June 1 to November 30, although Mother Nature does not always check her calendar), according to the forecast team at Colorado State University that tracks such storms.

That means summer is the time for coastal dwellers to consider how to insure against the next big one. The first thing to know is that there is no ‘hurricane insurance,’ but rather a couple of types of insurance that will cover the damage wrought by a hurricane.

WIND DAMAGE
A typical homeowner’s policy will cover wind damage from a hurricane, says Mike Barry, vice president of communications for the Insurance Information Institute in New York, but he advises homeowners to read their policies closely. Often the homeowner must pay a 1 percent to 5 percent deductible of the insured losses and the insurance company will pick up the balance, says Barry. If this is how your policy operates, you may want to keep a stash in your emergency fund to cover that deductible.

FLOOD DAMAGE
A storm surge from a hurricane is considered a flood and would be covered on a separate policy courtesy of the National Flood Insurance Program (you can find more information at floodsmart.gov), says Barry. It’s possible that you’re insured from a flood already: Mortgage lenders make flood insurance mandatory for homeowners who live in a flood zone that is part of the NFIP, says Barbara Lynch, a Federal Emergency Management Agency spokesperson. Typically a basic policy for the structure includes the mechanicals – for example, the furnace – and a homeowner can add “a la carte” coverage of the contents of the home, such as furniture. When it comes to what kind of coverage to purchase, Barry suggests keeping in mind there’s a nationwide maximum flood insurance limit of $250,000 for the home structure and a $100,000 limit for the personal items.

After your insurance needs are covered, backing up your insurance with home improvements, like storm shutters, is also a stellar idea for protecting your assets in a hurricane, says Barry.

Good luck and please comment if you have any additional advice or experiences you’d like to share.