Lurking beneath the shadows of your insurance policy are many rules and restrictions. Unless you are reviewing your homeowners policy carefully, you may be unaware of some of these details until you go to file an insurance claim and then are faced with an unwelcome surprise. One such area has to do with deductibles.
What is an Insurance Deductible?
Most homeowners insurance policies require policyholders to pay a baseline amount of money (a.k.a. the deductible) before the insurer kicks in on covered expenses. A standard deductible is typically a flat amount. However, in many states, especially where severe weather is common, insurance companies may also require specific deductibles related to the event. For example, some Louisiana policies have a hurricane deductibleor named-storm deductible. Others may also have a separate wind and hail deductible.
When Does a Wind and Hail Deductible Apply?
A wind and hail deductible is a specific type of deductible in some homeowners insurance policies that applies to damage caused by windstorms and hail. This deductible is separate from the standard deductible that applies to other types of covered perils. It’s also different from a named-storm or hurricane deductible. Wind and hail deductibles are only triggered by wind and hail damage.
If a storm has been named by the National Weather Service (NWS) or the National Hurricane Center (NHC), you can expect your named-storm deductible to apply. If you sustained wind damage but the storm system was not named by the NWS, the wind and hail deductible would apply.
How Much are Wind and Hail Deductibles?
Wind and hail deductibles are typically a percentage of the home’s insured value. Common percentages range from 1% to 5% or even higher. For a home insured for $400,000 with a 2% wind and hail deductible, the homeowner would need to pay $8,000 out-of-pocket before insurance coverage would kick in. It’s financially prudent for Louisiana residents to prepare for the potential financial impact of wind and hail deductibles by setting aside funds to cover the higher out-of-pocket costs in the event of a claim.
What to Know About Louisiana’s Single Deductible Statute
Those of us who live in Louisiana know we can be hit with multiple damaging storms in a single season. If you have to pay a wind and hail or hurricane deductible for each insurance claim you make in a single season, you could quickly go broke. To that end, states like Louisiana have enacted laws to offer some financial protection in these situations.
(informally known as the single deductible statute) states that for homeowners’ insurance policies issued or renewed after January 1, 2010, any separate deductible that applies for named storms or hurricanes must only be paid on an annual basis.
That means if you incur damage from multiple named storms or hurricanes within a single calendar year, the separate deductible only needs to be met once for all such events in that year.
Contact us at Kandell, Kandell & Petrie Law Firm with Questions
Wind and hail deductibles are a key feature of homeowners insurance policies in Louisiana, especially given the state’s susceptibility to storms. By understanding how these deductibles work and reviewing your policy details, you can better prepare for the financial impact of severe weather.
If you have questions about Louisiana insurance law, don’t hesitate to contact our legal team at Kandell, Kandell & Petrie. One of our New Orleans claims advisors is standing by to assist with your questions and, if you do need to file an insurance claim, ensure you get the full relief you deserve for your property damage in Louisiana.
