Ronald E. Prusek recognizes that you have important questions post Hurricane Sandy and has provided answers to the Top 10 questions regarding Insurance Law.
Our firm is prepared to review your insurance policies and review insurance claims.
10 Most Frequently Asked Questions About the Typical Homeowners Policy
1. If a hurricane, such as Hurricane Sandy, damages my house, am I covered?
Answer: That depends. If the hurricane causes wind-born damage to your structure and resultant damage to that structure from rain water enters the structure because of the wind damage, this IS COVERED all with the exception of the deductible you elected. If the damage is all of a result of flood, waves, tides, overflow of any body of water or spray from any of these, whether or not driven by wind or storm surge, it is NOT COVERED.
2. What is a “Hurricane Deductible” and how is it different from any other deductible in my homeowner policy?
Answer: Since 1998, the New Jersey Department of Banking and Insurance has allowed insurance companies in New Jersey to utilize “Hurricane Deductibles” in addition to that dollar amount for any damage caused by any peril covered by the policy except a hurricane. The hurricane deductibles are generally a percentage of the value of the property, and it is usual for the insurance companies to set that percentage based upon the property’s proximity to the coast. Obviously, the closer to the ocean or other body of water, the higher the deductible. Usually deductibles reach no more than 4% of the dwelling’s value. Therefore, should a $500,000.00 home be damaged by a hurricane and that damage is assessed to be $100,000.00, and that home is in a 4% hurricane deductible zone, the deductible would be 4% of $500,000.00 or $20,000.00. Therefore the insurance would deduct $20,000.00 from the $100,000.00 loss assessment, and pay $80,000.00.
3. What if I have wind damage caused by a tropical storm and not a hurricane? Does my hurricane deductible still apply?
Answer: Thankfully, no. Your standard deductible for peril loss for property would apply in that instance. These deductibles are usually chosen by the homeowner and affect the policy premiums. Naturally, the higher deductible, the less you pay for your policy and vice versa.
4. What is flood insurance?
Answer: Flood insurance is insurance that can be purchased separately to insure against all water damage not caused by a windstorm or that which would normally be covered under the insurance policy, such as burst pipes, roof leaks, gutter or leader damage, etc. Flood insurance is usually available through those insurance companies which specifically offer flood insurance. Check with your home insurance carrier to see if they offer flood insurance or shop around for those who do. Homeowners insurance and flood insurance need not be with the same company.
5. What if a tree on my property is blown over? Will my homeowners insurance pay to have it cut up and carted away?
Answer: In many instances, this is not covered. However, some policies in the section entitled, “Additional Coverages” talk about debris removal for instances that do not include windstorms of your own trees, and also debris removal up to a certain cap for debris that must be removed as a result of a neighbor’s tree that falls under specific circumstances.
6. My neighbor’s tree fell into my property. Is this covered by my insurance?
Answer: See the answer to the question above concerning debris removal. However, as the result of some negligence by your neighbor causing his personal property to encroach upon your property and cause damage, that may be covered by your neighbor’s insurance. You would then have to make a claim against your neighbor.
7. My house burned down or was swept away by a hurricane. Does my homeowners insurance cover this?
Answer: It depends. First, the dollar limits which you selected under the policy to insure your home, is the maximum that insurance will pay for your dwelling, other structures and personal property. See your policy to determine these dollar limitations.
Second, see if your policy has a present-value replacement clause or whether the property must be de-valued by depreciation for the number of years it was in use.
Finally, make sure the loss is a “covered loss.” For example, if your house burns down, most policies consider this a covered loss. If the house is destroyed by wind, most policies consider this a covered loss or a loss by hurricane in that event, with a higher deductible. However, if the loss is occasioned by flood or tidal water, this may not be covered. Read your policy.
8. What if I hire a handy man to paint my house or clean my gutters, and he falls and injures himself. He says he does not have a worker’s compensation insurance. Does my homeowners insurance cover him?
Answer: Yes. However, only up to a certain limit that you have selected under your coverage, “Medical Payments to Others.” Carefully read your policy which usually will set out the provisions which must be met for a claim to be paid. That is, the person must be at your home with your permission, and is not available to you or any residents of your household.
9. What if my car is vandalized and my antenna is broken off? Is that covered by my homeowners insurance?
Answer: No. That is covered under your motor vehicle policy, under the comprehension section, which will undoubtedly contain a deductible which you have chosen, affecting the policy premiums. Refer to your automobile policy for the precise deductible and the extent of your comprehensive coverage.
10. My car was parked on a city street and broken into, and my leather briefcase and digital camera were stolen. Is this covered by any insurance?
Answer: Yes it is. Your homeowners insurance covers your personal property which has been lost due to theft in all but certain specific situations (like theft committed by another name insured) and for specific types of property (like silverware). Check your policy for further clarification.
We listen, so we can help. All these questions are likely ones you’ve asked yourself since the Super Storm. For more information on how our firm may be able to help you or if you have questions about what to do next, call our offices at (732) 797-1600.