Who needs wind and hail insurance?
Every homeowner needs home insurance, including wind and hail insurance to protect their home, their family, and their possessions. While maintaining home insurance is not legally required anywhere in the United States, it is generally a required part of home ownership due to the regulations around mortgage lenders and their interests. You may find that a mortgage company is unwilling to back the purchase of a home without confirmation of homeowners coverage solidly in place.
Wind and hail coverage is often a top priority for insurance providers and mortgage lenders. After the many thousands of claims filed as a result of Hurricane Katrina in Louisiana, insurance companies were compelled to carve out wind and hail storm coverage as a separate level of protection within traditional homeowners policies. This allowed for the assignment of a wind and hail-specific deductible cost for Americans living in higher risk areas.
Nineteen states legally require wind and hail policies to use a ‘percentage deductible’ that is calculated based on the value of a home. This method replaces the ‘standard deductible’ that was based on the dollar amount of damage that was inflicted on the home.
States Where a Percentage Deductible is Required:
Alabama, Connecticut, Delaware, Florida, Georgia, Hawaii, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas, and the District of Columbia
What does wind & hail insurance cover?
A wind and hail provision under your homeowners insurance policy covers damage to your home caused by these specific ‘perils’ that can be confirmed by the insurance adjuster. One example of a common exclusion is damage from ‘named storms’ such as hurricanes or tropical storms.
Insurance Adjuster - An expert in construction or damage recovery who is employed by an insurance company to make a detailed descriptive and photographic record of the damage to your home and calculate the best plan for recovery.
As for the specifics of covered damage, most policies will pay out for repairs including:
- Damaged or missing shingles
- Holes in the roof or walls
- Broken windows or glass
- Leaks caused by wind or hail
Note: Vehicles located at a home are generally not covered by home wind and hail insurance policies, and require separate vehicle insurance.
Why can’t some people be insured?
It is true that not every person who’d like to own a home in the U.S. is able to do so. Reasons can range from financial difficulties to a shortage of available housing in someone’s hometown. But the need for an in-force home insurance policy can also be a roadblock for many.
Every claims interaction with traditional insurance companies is recorded as a part of that person’s ‘loss history record.’ and similar to a credit report, too much of the wrong kind of activity can mean trouble ahead for the potential insurance customer. Claims activity is recorded in a document known as a CLUE Report, and if multiple claims are visible within the seven years of history displayed in this record, it’s likely that insurance coverage offered to the potential homeowner would be prohibitively expensive, or not be offered at all.
CLUE Report - Comprehensive Loss Underwriting Exchange - A record of insurance claims made against a property. This information is sometimes used to calculate insurance rates for traditional homeowners policies.
What are my alternatives to private insurance?
If you’re unsuccessful in finding homeowners coverage you may have some options to improve your insurability. Some states with higher risk for wind and hail storms have created programs to make it easier for homeowners to obtain coverage for their properties in those areas.
State-subsidized home insurance is not common, but several states have seen success with plans that offer assistance for home improvements that will result in stronger roofs, more secure homes, and hopefully fewer roof insurance claims and lower deductibles statewide in the near future.
Which states offer wind/hail assistance?
The states listed below have programs in place to encourage the use of safer, stronger materials and building techniques for roof construction.
Alabama - Strengthen Alabama Homes
Kentucky - Strengthen Kentucky Homes
Oklahoma - Strengthen Oklahoma Homes
Louisiana - Louisiana Fortify Homes Program
Florida - My Safe Florida Home
South Carolina - South Carolina Safe Home
Minnesota - Strengthen Minnesota Homes
North Carolina - Strengthen Your Roof / Strengthen Your Coastal Roof
What other resources are available?
Residents of states that have experienced a declared state of emergency within the year may have additional resources available to them. The Federal Emergency Management Agency (FEMA) has provisions for helping disaster-impacted Americans.
Are there supplemental wind and hail insurance policies?
If you are unable to obtain traditional homeowners insurance, or feel that you are underinsured with your current coverage, a supplemental wind/hail policy can be a smart way to lower your risk level and add an extra layer of protection from weather-related financial stress.
Sola Wind and Hail Insurance is a standalone policy that can be purchased along with other homeowners coverage, or independently, with no other obligation. Sola residential coverage is available for amounts ranging from $2,000 to $25,000, with the payouts being available within a matter of days after a claim was made, giving the homeowner a chance to repair their home and reclaim a sense of order after a damaging storm.
Sources:
“Background on: Hurricane and Windstorm Deductibles” Insurance Information Institute, June 23, 2021, https://www.iii.org/article/background-on-hurricane-and-windstorm-deductibles
Gray is the Senior Content Specialist at Sola Insurance, working with the Sales and Marketing teams to provide helpful, valuable content for homeowners and agents. Gray has worked previously in finance, logistics, and advertising.
