On August 24, 1992, Hurricane Andrew struck Miami with losses that had never been seen in America before. Andrew caused most carriers to stop writing property coverage in the state and a state pool the Florida Joint Underwriting Association FJUA (now known as Citizens) was formed to provide coverage for Florida homeowners. A special hurricane wind deductible percentage was established forcing Florida homeowners to participate in future losses. It was believed that adding a wind percentage deductible would give the FJUA stability and attract private carriers back to the state. So how exactly does a wind deductible work?
The wind deductible is a percentage typically 2, 5 and 10 percent of coverage A which is the insured Dwelling value. For example, a 100,000 coverage “A” policy with a 10% wind deductible has a 10,000 deductible. These Deductibles are annual so that if you experience more than one loss in a year you are only assessed the deductible one time. The wind deductible is assessed when your home is damaged by a named storm/hurricane. Additionally, some carriers have a deductible called “Other Wind” which refers to a non-named storm deductible. For any other type of covered loss on your policy, you will have what is called an “All Other Peril” deductible and this number traditionally is a dollar amount 500, 1000, 2500 or more.
When shopping for hurricane coverage it is important to note that there are minimal savings in increasing a wind deductible on your policy. The best way to shop for coverage is to receive quotes from multiple carriers as prices vary significantly. Additionally,y some carriers give money saving perks such as disappearing wind deductibles. A disappearing deductible is given to clients with no wind claims for 5 years or more and are free perks.
Home Insurance in Florida is a significant investment knowing your deductible options is important as we head into Hurricane season.