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    Personal Insurance Blog

    Hurricane Defined for Insurance

    Posted by Gordon Atlantic Staff

    Thu, Sep 19, 2019 @ 01:06 PM

    Prepare yourself for storms with hurricane insurance from andrew gordon incIn the aftermath of Dorian, the question remains: what makes a storm a hurricane?

    The answer to this question is a significant indicator as to how claims are handled by insurance carriers.

    So, let us determine what constitutes a hurricane.  Here are some of the conditions that must be met:

    1) Low pressure system.

    2) Warm temperatures over the ocean.

    3) Moist environment (precipitation).

    4) Tropical wind patterns over the equator.

    Once these conditions are met, a hurricane must have sustained winds of 74 miles per hour or more. The eye of the storm is usually 20 to 30 miles wide and the storm itself may extend up to 400 miles across. The inherent dangers of this type of storm are torrential rains, high winds and tidal surges (super high tides). A hurricane can last for two weeks or more over open water and run a path the length of the Eastern seaboard, from the Caribbean to Nova Scotia.

    What caused of Hurricane Dorian to stall over the Bahamas?

    When a hurricane moves, the time spent in any particular area is limited.  But when it stalls, as Dorian did over Great Abaco for over 36 hours, the devastation continues. The damge Hurricane Harvey caused in Houston was not so much the wind, but the 52" of rain that fell in 48 hours after Harvey's landfall.  Hurricanes break apart, or move, when upper level air, the air above the hurricane's most violent force, prevents storm air from rising.  Strong air movement above the hurricane creates shear, disrupting the pattern of spinning storm.  We like upper atmospheric shear on a hurricane.  Similarly, continental high pressure from land (westerly) also pushes hurricanes out to sea limiting damage to homes and businesses.  We also like high pressure from the west, southwest or northwest.  

    On average, 100 tropical storms develop each year between May and November over the Atlantic Ocean.  Only six eventually develop into hurricanes and of these six, two are likely to strike the coast of the United States. The Atlantic Hurricane Season begins on June 1 and ends on November 30 of each year, with the most active time being from mid-August through mid-October.  The winter hurricane threat is virtually non-existent.

    For homeowners living near the coast, having wind or named storm deductibles is common.  For more about these - and which is the better among evils - visit our Named Storm vs. Windstorm deductibles page

    If you have any other insurance questions, please contact us here at Gordon Atlantic Insurance. We'll help you understand any confusing definitions or tricky aspects of insurance.  We make insurance make sense.

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    Tags: personal, hurricane, insurance, definition, storm, wind, sandy

    Wind Deductible vs. Hurricane vs. Named Storm Deductibles

    Posted by Geoffrey Gordon

    Thu, Aug 15, 2019 @ 09:40 AM


    You call the insurance company after a big nor'easter or hurricane, with a tree sitting on your house, and they tell you that you have a "wind deductible."  What's that?  

    It's a separate deductible from the one that applies to everything else to lower the cost of storms to insurance companies in wind-prone regions.  There are a few variations beyond just "wind," and we'll look at which are better (if your location limits your choices and have this provision).

    House damaged by tree-927040-edited.jpgWhen a storm hits, the distinction between Named Storm deductibles, Wind storm deductibles and Hurricane deductibles can be important. The distinction is particularly important if you live or own property in a coastal county in Massachusetts, such as Plymouth, Dukes, Barnstable, Bristol, Suffolk and Essex, because all are generally available and choosing the right one might make a difference in the cost to repair your home after a storm. 

    Here's how it works:  these deductibles are applied separately for a higher dollar amount than your standard deductible, known as “all other perils” (AOP) deductibles.  For example, if you have a $1,000 deductible for fire, theft and all other perils and you live on the coast, you may have a $2,000 or higher deductible for windstorm and hail losses.

    More common than dollar amounts however, wind deductibles are often expressed as a percentage of the coverage amount on your home. For example, a 1% wind deductible on a $300,000 home would be $3,000 and a 2% wind deductible would be $6,000.  A 5% wind deductible on a $700,000 home is $35,000!!  Here in coastal Massachusetts counties, 1%, 2% and 5% wind deductibles are common if your property is within a mile of the coast.  

    These deductibles are part of an effort by the insurance industry to limit their storm losses by having homeowners share more of the repair costs when the wind blows.  Informed property owners - that's you - can take steps to protect homes when especially vulnerable to wind damage.  After all, if you have a 5% deductible on half a million dollar house, you’ve got 25,000 good reasons to consider storm shutters, a generator, the highest quality shingles, fewer trees in the yard, and other protections. 

    If you have a wind deductible it normally will appear right on the "declarations" (first) page of your homeowner’s insurance policy.   Different insurance companies use different metrics for these specific peril deductibles. The three most common approaches are:

    1. Windstorm deductibles (the broadest, meaning it will affect the most people)  
    2. Named Storm deductibles (common) and
    3. Hurricane deductibles. 

    The broadest of these three, meaning where it will apply to the most consumer claims, is a Windstorm deductible.  These deductibles apply whenever damage is caused by wind; these include not only hurricanes and other tropical storms but also winter nor'easters and summer thunderstorms.   Any kind of wind damage will prompt this higher exposure to the owner.

    The next category is Named Storm deductibles.  To illustrate, remember the notorious “no-name" storm?  Damage from that storm would not have been subject to a higher Named Storm deductible, but would have under a Wind deductible.  The regular, smaller AOP deductible would have been used for any damage caused by the no-name storm under a Named Storm deductible.    But damage from Hurricane Irene or Hurricane Sandy, or other named storms would have invoked the Wind and/or Named Storm deductible. 

    Finally, there are the most restrictive Hurricane deductibles.  Hurricane Sandy is a good example of the distinction between Named Storm and Hurricane deductibles.  When Sandy made land fall in New Jersey she had been downgraded from a Category I hurricane to a tropical storm. Thus, the lower AOP deductible applied to folks with a Hurricane deductible. Hurricane deductibles have become less common due to the potential for political interference after the fact, as was evident with Sandy.  Some suggested that the downgrade of Hurricane Sandy was precisely announced to shield homeowners from the Hurricane deductible.   Good for consumers with that one event, but insurance carriers quantify risk precisely, and after the fact interference prompted changes for the next event.  Thus what were Hurricane deductibles have morphed into Named Storm deductibles in most coastal regions.

    Many considerations should factor in your choice of insurance companies for selecting homeowners and other property insurance.  But all else being equal, and given the option between Windstorm vs. Named Storm, choose Named Storm as it is more restrictive. Given the choice between Named Storm and Hurricane deductible, you should choose a Hurricane as it’s the least likely to be invoked.  

    For more information on the subject, check out our short but super-informative whiteboard video where we give cost examples of various deductible options near the coast.

    If you've just discovered you have a higher wind deductible than you are comfortable with, contact us at 800-649-3252We can also research better offers for you - just click the link below. 

      Coastal Insurance  eBook REQUEST A QUOTE

    Geoff Gordon

    Tags: insurance, homeowners, storm, deductible, wind, windstorm, Coastal, deductibles, named, all other perils, AOP

    Microbursts: Surprise Storms

    Posted by Gordon Atlantic Staff

    Mon, Aug 26, 2013 @ 09:59 AM

    Have you ever heard of a microburst? I sure hadn't until one of my fellow coworkers in this very office explained to me what they are. Naturally, I had to research them, and what I found is mind-boggling.

    Weather Words

    So if you're into weather speak and meteorology talk, then you'll be intrigued to hear that a microburst is just a bunch of sinking air. However, when this air sinks, it sends little tornadoes and strong winds just in that area.

    Be prepared for home damage from surprise storms with homeowners insurance from andrew g gordon inc

    Microbursts consist of three stages: contact, outburst, and cushion. The first stage is when the air descends from the clouds and to the ground, making contact. The second stage is when the air move aways (typically horizontally along the ground). The third stage is when the horizontal winds accelerate but the initial winds begin to slow down.

    Regardless of which stage a microburst is, there will be very, very strong winds that have the ability to known down trees and buildings. And while hurricanes and other tropical storms can have both strong winds and heavy precipitation, microbursts are different. Why? Mostly because they can appear out of nowhere and are very difficult to predict.

    Damage and Insurance

    I just spent some time telling you how microbursts differ from any other storm. Now I am going to contradict myself and tell you the good news when it comes to insurance!

    Even though microbursts are weird little storms that can really pack a punch, insurance covers for their damage. They are just like any other storm. Most of the damage caused by microbursts comes in the form of falling trees. To protect yourself against loss, make sure you have a wind policy that adequately covers your home's worth, especially if you live in a heavily wooded area.

    For those "wet-microbursts" that come with a lot of flooding, only a flood policy can protect you from loss in the event of a flood. So, similar to the wind situation, as long as you have the appropriate policy, your insurance will cover you in case of a microburst. Hooray!

    Microbursts in MA

    Fortunately, microbursts are not that common. However, that doesn't mean that they do not occur. Recently, Agawam was faced with a microburst that caused lots of damage. For more information on that damage, click here.

    Microburst Video

    Here is a video explaining microbursts and showing some of the severe damage these storms can cause.

     

    If you have any other insurance questions about anything- home, auto, commercial, life- feel free to contact us at any time. Learn about homeowners coverage here.

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    Tags: home insurance, house, home, house insurance, microburst, strong wind, fallen tree, tree damage, tree, Flood, storm, wind, windstorm, property damage, flood insurance

    Insurance Near the Massachusetts Coast

    Posted by Geoffrey Gordon

    Wed, Jun 20, 2012 @ 09:03 AM

    Living on the coast of New England has always had its advantages: proximity to the beaches, the memorable sunrises/sunsets, and cool ocean breezes in the summer. Offsetting these advantages, however, are new challenges in insuring a home wherever these breezes keep you cool during the dog days of summer.

    Why do they cost more?

    Trust Andrew Gordon Inc Insurance Norwell MA with your coastal home insurance for the best coverage

    Insurance companies’ concern with coastal homes is not about floods (flood damage is excluded, and needs to be insured separately). It’s the wind.  Wind can knock down trees, phone and electrical lines, and damage roofs, exposing the rest of the house to rainwater and related problems. Wind poses a “severity” concern too, since one storm can generate large losses for many companies throughout a broad region. Not surprisingly, reinsurers (who provide catastrophic insurance for insurance companies) are demanding new restrictions on how coastal property owners participate in their own losses.

    How are insurance companies dealing with this?

    To moderate severity geographical concentrations, and to provide incentives to homeowners to protect against wind damage, most companies are imposing mandatory wind deductibles, near the coast. These are distinct and separate from your standard deductible. There are two categories, and the distinction can be important: “Named Storm” deductibles apply only to claims arising from a Named Storm (i.e. Class 3+ Tropical Storms & Hurricanes). A broader “Wind/Hail” deductible, applies to any wind/hail loss. When given the choice, a Named Storm deductible is preferred, simply because it won’t apply as often, such as on damage from winter nor’easters or summer thunderstorms… or the notorious “No-Name” perfect storm.

    How much is this costing me?

    These new deductibles are usually expressed as a percentage of your dwelling (house) amount, and range from 1% to 5% depending on location and a company’s existing exposure. For example, a 2% wind deductible on a home insured for $250,000 translates to $5,000, a significant amount to “self-insure”. Distances generally dictate the amount you share: less than 1000 feet from the shore (3% – 5% wind deductibles common), 1000’ —2500’ (2% common), 2500’ to 1 mile (“named storm” deductibles become available), and 1– 5 miles (more markets, more choices become available).

    Can you avoid a wind deductible if you’re within these ranges? 

    Sometimes. Contact Andrew Gordon Insurance for home insurance solutions that fit your budget and your tolerance for risk at our website. Get a coastal home insurance ebook here

    Home Quote Request Coastal Insurance  eBook  

    Geoff Gordon

    Tags: beach, home, summer, insurance, coast, homeowners, Flood, deductible, wind, Coastal

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