Homeowner's insurance rates vary dramatically in different parts of the country based on the assessed risk of living in that area. Some areas of the country, like Iowa and Idaho, have relatively low homeowner's insurance rates because communities in those areas have a lower risk for tornadoes, hurricanes, floods and other disasters. Texas, Florida and Louisiana often face large scale natural disasters and premiums can be higher in these states.
Homeowners Insurances and Hurricane Insurance
While it used to be that comprehensive homeowner's policies covered all fire, wind, rain, flooding and other weather related damage, many policies today are specifically excluding flooding, or in certain areas, not covering any hurricane related damage whatsoever. It is important to read the fine print of all insurance contracts carefully, and make sure to arrange for additional flood and/or hurricane insurance if your current policy does not already include it.
Typical Hurricane Insurance Costs
Insurance policies specifically covering hurricane damage vary dramatically in cost based on location, age, condition of the home and other factors. According to the National Association of Realtors, in Miami-Dade County (FL) in 2010, the annual premium on a house insured for $150,000 is in the range of $3,000 to $8,000, given the home has no hurricane mitigation improvements and a 2 percent hurricane deductible. If the house had been fitted with hurricane mitigation improvements, it would only be around $1,000 to $3,500 for the same policy on the same house.
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You also need to consider hurricane deductibles when deciding on a policy. Many recent comprehensive homeowner's policies have a specific hurricane deducible built into the contract, ranging up to 5 percent of the value of the insured home. In the event of damage from a named storm to a home insured for $300,000, for example, you would have to pay a $15,000 deductible and the insurance company would pay for any additional damage up to $300,000.
Review Your Hurricane Risks and Current Coverages
Perhaps you are somewhat inland or on top of a hill, so all you need is a policy covering wind damage, which can be considerably less than a comprehensive policy covering all damage including flooding. The average premium for a flood policy in the U.S. is around $540 a year according to the National Flood Insurance Program, however, flood insurance premiums are likely to be higher in hurricane prone areas, and it can be difficult to find flood insurance at any price in some areas.