Hurricane Insurance: What to Know About Protecting Your Vacation Rental

Hurricane insurance can be a confusing subject. What many property owners may not realize is that no single insurance policy will fully cover you from hurricane-related losses. In fact, you may require a mix of different coverages to ensure that your vacation rental home has the insurance it needs to survive a potentially devastating hurricane season. As we head into peak hurricane season, now’s the time to make sure that you are completely protected. We’ve got the details on what you need to know about hurricane insurance for your vacation rental before disaster strikes.

Breaking Down Hurricane Insurance: Windstorm and Flood

In insurance terms, hurricanes fall under two main causes of loss: windstorm and flood.

The term “hurricane insurance” is a misnomer. What you actually should be looking for is windstorm insurance (which should include hail) and flood insurance. Since the damage or losses you’ll experience during a hurricane are caused by either windstorm and/or flood, these are the two causes of loss that you will need coverage for.

Windstorm and hail insurance provides coverage for any losses that are a direct result of windstorm or hail damage. If you suffer a loss (broken windows, damaged roof, etc.) due to winds or hail, Windstorms should generally cover it. There is usually a deductible for each building.

A CBIZ Vacation Rental Insurance policy provides coverage for windstorm but not flood, which leads us to our next point:

Only the Government Can Provide Flood Insurance

No homeowner's policy covers flooding. But then again, neither does vacation rental insurance. You can only get flood coverage through FEMA’s National Flood Insurance Program.

If your vacation rental is located in an area that is at high risk for flooding, you may consider purchasing a separate flood insurance policy that covers both your vacation rental and its contents.

As we mentioned above, flood damage is not covered by a CBIZ Vacation Rental Insurance policy. However, if your property is located in a flood-susceptible area then we can quote flood insurance policies through the National Flood Insurance Program for you.

Is Windstorm Coverage Optional?

Depending on where your rental property is located, windstorm and hail coverage is optional—if it is located in a high-risk area, you have the option to deny coverage if you choose. Some property owners may opt-out of windstorm and hail coverage because premiums can be high, particularly if your vacation rental is located in a high-risk area. Overall, costs will vary depending on how high the risk is for hurricanes in your area.

But is it wise to deny windstorm coverage? Perhaps not.

Consider this scenario: let’s say the government orders a mandatory evacuation of the area due to an impending hurricane. This could result in canceled rentals since people won’t be able to visit the area affected by the evacuation. Your peak season could be ruined and you won’t be able to make the income you expected to this year. Now, unless you elected windstorm and hail coverage you won’t be covered for that loss of income. Why? Since the government mandated that the area be evacuated due to a hurricane (which is the cause of loss), you would need windstorm and hail insurance to cover any lost income you might experience.

Don’t Get Blown Away by Devastating Losses This Hurricane Season

Understanding “hurricane insurance” can be tricky. The main thing you need to know is that if you want protection for your vacation rental during hurricane season, you’ll need to elect windstorm and hail coverage through a CBIZ Vacation Rental Insurance policy as well as a separate flood insurance policy through the National Flood Insurance Program.

We want to help you find the right windstorm and hail coverage for your vacation rental. Request a free quote today!

This blog may contain scenarios that are provided as examples only. Coverage is subject to the terms, conditions and exclusions of the policy issued. The information provided is general in nature and may be affected by changes in law or the interpretation of such laws. The reader is advised to contact a professional prior to taking any action based upon this information.

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