Understanding your insurance coverage is a vital, but often overlooked step in preparing for the destruction caused by a hurricane or windstorm.
Understanding these five areas may mean the difference between a speedy recovery and a financial burden when it comes time to rebuild your home, restart your business, or simply put your life back together.
Buy-back deductibles for windstorm damage
Most common causes of property loss (i.e. fire damage and flooding from burst pipes) have a fixed deductible. The deductible for a windstorm, on the other hand, is calculated as 2, 3, or 5 percent of your policy limit. For a large loss, this can result in considerable expense to the policyholder.
One way to protect yourself financially in the event of windstorm damage is to purchase supplemental coverage in the form of a buy-back deductible. This allows you to simply pay an additional premium.
Coverage for updated building codes or ordinances
When rebuilding or repairing an older structure, an unpleasant surprise can come in the form of updated building codes and local ordinances. Satisfying these new requirements often means that simply restoring your property to its original condition isn’t enough. In that case, neither is the coverage in your original policy.
Fortunately, special building ordinance or code coverage can be added to your policy. This provides sufficient funds to allow full compliance with the current building codes.
In the aftermath of flooding caused by a hurricane or windstorm, serious mold development is a common problem. Once mold becomes established in a structure, full remediation is often highly expensive. For this reason, many insurance policies exclude mold from coverage or include a cap on the available payout for mold remediation.
In this case, prevention is truly the best medicine. All wet drywall, floor coverings, and furniture should be removed as soon as possible, and the structure should be thoroughly dried. This eliminates the conditions that favor mold growth. A quick cleanup might have the appearance of saving money at first, but failing to properly deal with the problem can lead to sizeable expenses in the long run.
This is an area where policies can vary greatly. Some clearly provide additional coverage of 10 or 25 percent above the policy limit for debris removal. Others are less straight forward. Understanding the language in your policy beforehand is extremely important. In the event of an extensive loss, ambiguous policy language can cause serious disagreements with your insurance carrier and has resulted in lawsuits in some cases.
Spoilage of perishable goods
If you own the type of business where your inventory includes large amounts of perishable goods such as food products or pharmaceuticals, widespread power outages caused by hurricanes and windstorms are a serious concern. Losses to property of this kind are some of the most common that occur.
A good way to protect your profits is to purchase a Spoilage Endorsement. This provides coverage in the event of power outages or mechanical failure of refrigeration equipment.
In the aftermath of a natural disaster, too often individuals and businesses suffer from inadequate coverage or simply from the complexity of the claims process. Being as informed about your coverage as possible beforehand allows you to limit risk and plan for your financial security. In addition, the advocacy provided by a public insurance adjuster can be vital in helping you to navigate these difficult circumstances.
Have questions about your property insurance claim? Feel free to contact Stark Loss for more information about how a Public Adjuster can help.