Hello, and thank you for reading. This article is designed to give a quick concise explanation of how the different hurricane deductible options work.
Percentage Hurricane Deductible (most common)
First (and I believe the most mis-understood) is the percentage-based hurricane deductible. The most common hurricane deductible for home insurance in Florida is the 2% hurricane deductible. That 2% does not mean 2% of the damage caused by the storm. The 2% stands for 2% of your dwelling coverage (or Coverage A). Simply put if your policy covers your dwelling at an amount of $200,000 your hurricane deductible would be 2% of $200,000 which equates to $4,000.
Flat Hurricane Deductible (less common)
Less common but becoming more popular (especially with the recent hurricane activity in Florida) is the flat hurricane deductible. A flat hurricane deductible is just that, a flat amount (usually $500 or $1000). This is easier to understand because it is just a flat amount.
Pros and Cons of Percentage Based and Flat Deductibles
Percentage Based Deductible:
I hope this article helps! I tried to keep it as unbiased as possible. If you have any further questions I would recommend you contact your local independent insurance agent, or us :) for we would be more than happy to help!
About the Author:
Richard Dixon is the owner and operator of Wellcovered Insurance, a local independent insurance agency located in Orange City, Florida.