Apr
8
2008
What Factors Are Considered In Establishing Hurricane-Wind Premiums?
Author: Valeria Weber
Upgrades to your home that offer increased protection from wind damage can also reduce your out-of-pocket expenses after a catastrophic event. Here’s a breakdown of the key factors an agent considers when figuring the annual premium on a homeowner’s policy:
1. Location – Homes closer to the coast or other bodies of water are at more risk for hurricane damage (and flooding) than those farther away.
2. Number of Policies – A basic insurance policy covers such perils as fire or theft. Hurricane damage is a special worst-case scenario that is covered with a separate deductible, as is flood insurance.
3. Deductible – Depending on which state you’re in, you may have a choice in how much money you’re willing to pay out before insurance kicks in to cover damages. Typical deductibles range from $500, to 2 percent, 5 percent, or 10 percent of your home’s value. The higher the deductible, the lower your premiums will be.
4. Home Improvements – Many states require insurance companies to give premium discounts if you’ve taken reasonable steps to secure your home ahead of time. Making permanent improvements to insure your roof won’t blow off or your windows won’t be broken usually offer the biggest discounts.
It’s not just about the money, though. These same improvements are also protecting you and your family when you seek shelter from a storm. Hurricane season officially begins June 1st so there’s still plenty of time to get started.
