Does homeowners insurance cover hurricane damage? Wind, water, and the policy that answers each

Homeowners insurance usually covers wind damage from a hurricane and usually does not cover flood damage, and on the Texas coast most homeowners policies do not cover wind and hail either, which is why the Texas Windstorm Insurance Association exists. Whether a particular loss is covered turns on what caused it, wind or water, and on the wording of the policy you hold.

254 Engineering is an engineering firm. It is not an insurance agent or an adjuster, it does not advise on any particular policy, and every coverage statement below is the regulator's own, cited in the sources. What an engineer contributes is the structural fact underneath a claim: what failed and why. Where a repair needs a defined scope, that is the job of a repair specification.

Three policies, two perils

The Texas Department of Insurance sets it out in three lines. Homeowners insurance covers damage from events such as fire, lightning, theft, wind and hail. Flood insurance covers damage from rising water, and the department notes that most home policies do not cover floods. Wind and hail insurance covers wind and hail, and the department notes that most home policies on the coast do not cover wind and hail.

So a coastal owner can hold three policies: a homeowners policy for everything except wind, hail and flood, a wind and hail policy, often through the association, and a flood policy through the National Flood Insurance Program or a private flood insurer. Inland, the homeowners policy usually carries the wind.

Storm surge sits on the flood side. The department's COAST program sheet says the association does not cover storm surge or flood damage and that flood insurance is administered separately through the National Flood Insurance Program. FEMA says that most standard homeowners policies do not cover flood damage and that a flood policy typically takes 30 days to become active, which is why a flood policy bought as a storm approaches is unlikely to answer for that storm.

Why the cause of the damage decides the claim

A coastal house after a hurricane often has both kinds of damage. The roof deck lifted in the wind, rain came through the opening, and surge came up through the ground floor. Each of those can belong to a different policy, and a wind policy that excludes flood and a flood policy that excludes wind will each want to know which caused what.

That is a structural question before it is an insurance one. A lifted truss, a breached opening and a displaced foundation each leave evidence of the force that caused them, and reading that evidence is engineering. A checklist for finding it is on the hurricane damage structural checklist.

An engineer's report on cause answers to the facts and not to whoever paid for it. The rule behind that is set out on the inspection versus forensic report page: on sealing, the engineer takes full professional responsibility for the work. A report that reached the conclusion its client wanted would be worth nothing to either side. Where a sealed statement about a specific damaged element is what an insurer, a lender or a building department has asked for, a structural letter is the document.

Deductibles are a percentage of the insurance, not of the claim

Many wind and hurricane deductibles are percentages. The Office of Public Insurance Counsel, a Texas state agency, explains that a percentage deductible is calculated on the amount of insurance on the home, not on the amount of the claim. Its example uses a home insured for $200,000 with a $7,000 claim. At 1 percent the deductible is $2,000 and the insurer pays $5,000. At 5 percent the deductible is $10,000, more than the claim, and the insurer pays nothing.

The same agency notes that a wind and hail deductible typically applies to any damage from a wind or hail event, and that a named storm deductible is typically triggered when the National Weather Service names a storm. Which applies is in the declarations page of the policy. For association policies, the department lists residential deductibles of $100, $250 or 1 percent, with optional larger deductibles from 1.5 to 5 percent.

Claim deadlines in the Insurance Code

For a homeowners claim, section 542.055 of the Insurance Code requires the insurer, not later than the 15th day after receiving notice of the claim, to acknowledge it, begin any investigation and request the items it needs. Section 542.056 then requires written notice accepting or rejecting the claim by the 15th business day after the insurer receives everything it requires, and if the insurer needs more time it must say why within that period and decide by the 45th day after that notice. A rejection must state its reasons.

For an association policy, section 2210.573 requires the claim to be filed within one year of the date the damage occurred, subject to section 2210.205(b), and requires a written decision within 60 days unless the commissioner extends the period. The department's COAST program sheet adds 60 days from the association's notice to request appraisal and 545 days from the claim decision to submit replacement cost documentation. The association's other rules are on the TWIA insurance page.

When the association accepts only part of a claim

Section 2210.573 also says what the association's written decision has to contain. A full acceptance states the amount it will pay and the deadline to request appraisal under section 2210.574. A partial acceptance or a denial states the accepted portion and its amount, explains the denied portion in detail, and gives the deadlines to request appraisal and to give notice of intent to sue under section 2210.575, with a form for that notice attached.

Where the dispute is about cause, wind against water or storm against age, the evidence that resolves it is physical. A detailed explanation of a denied portion tells an owner which fact the association relied on, and that is the fact a structural assessment either confirms or contradicts.

What to do in the first days

The department's guidance for association policyholders is practical. A claim can be started before the damage has been fully reviewed. Take photos and video of the damage. Make temporary repairs, such as boarding up broken windows and doors and removing standing water, and save the receipts. And skip any contractor offer to pay the deductible, which the department lists among storm repair scams.

Before a permanent repair starts inside the catastrophe area, remember that a repair is an improvement under section 2210.2515 of the Insurance Code and needs written notice to the department before the work begins. A claim paid on a repair that then cannot be certified leaves the house outside what the association may insure under section 2210.258(b), subject to that section's exceptions. The repair sequence is on the re-roofs and repairs page.

Where the structural damage includes the foundation, an elevation survey turns an argument about movement into a set of numbers, which is what a foundation inspection records.