November 2007
Disaster defenses for your home
Estimated insured losses from 2005’s hurricanes Katrina, Rita, and Wilma already approach a record $50 billion, while losses
from wildfires in 2003 hit over $2 billion in California. But you needn’t live on the coasts or in California’s earthquake
zone for your home to be a disaster risk. North Dakota has had 15 federally declared disasters since 1990, while Pennsylvania
was second only to Florida in recent hurricane-related claims for flood damage. Indeed, after fire, flooding is America’s
most common natural disaster.
The right upgrades can help protect your home from all but the most-devastating events. A preliminary study by the Hurricane Center at Louisiana State University suggests that nearly 80 percent of the wind damage from Hurricane Katrina might have been prevented if homes had been built or retrofitted to the stronger Dade County-South Florida building codes enacted after Hurricane Andrew.
Insurance companies are increasingly shifting the risks and financial burdens back on to homeowners. Windstorm deductibles in 18 states and the District of Columbia now put you on the hook for up to 15 percent of your home’s replacement value for repairs before coverage kicks in. A separate deductible of up to 20 percent of replacement value applies for earthquakes and 1 to 2 percent for hailstorms in some states. Mounting disaster claims could mean even higher premiums or added restrictions for homeowners in disaster-prone areas, says Robert Hartwig, chief economist for the Insurance Information Institute.
Another possibility is that insurers could follow the model for cars and charge more for less-safe homes. "Right now, the focus for most people is aesthetics and very little on the guts of the home and how it will hold up in a major event," says Hartwig.
Those building new homes or additions can get disaster-fortification guidelines from the Institute for Business & Home Safety (www.ibhs.org), a group funded by the insurance industry. Go to the "Fortified... for safer living" section of the site at www.ibhs.org/property_protection/default.asp?id=8 and enter your ZIP code for recommendations for your region. Though those measures can add 3 to 5 percent to construction costs, your home will be more likely to weather a disaster with less damage, according to Tim Reinhold, vice president of engineering at IBHS.
How can you safeguard an existing home? Here are some practical upgrades you can make right now or as part of a roofing, siding, or other remodeling project.
The right upgrades can help protect your home from all but the most-devastating events. A preliminary study by the Hurricane Center at Louisiana State University suggests that nearly 80 percent of the wind damage from Hurricane Katrina might have been prevented if homes had been built or retrofitted to the stronger Dade County-South Florida building codes enacted after Hurricane Andrew.
Insurance companies are increasingly shifting the risks and financial burdens back on to homeowners. Windstorm deductibles in 18 states and the District of Columbia now put you on the hook for up to 15 percent of your home’s replacement value for repairs before coverage kicks in. A separate deductible of up to 20 percent of replacement value applies for earthquakes and 1 to 2 percent for hailstorms in some states. Mounting disaster claims could mean even higher premiums or added restrictions for homeowners in disaster-prone areas, says Robert Hartwig, chief economist for the Insurance Information Institute.
Another possibility is that insurers could follow the model for cars and charge more for less-safe homes. "Right now, the focus for most people is aesthetics and very little on the guts of the home and how it will hold up in a major event," says Hartwig.
Those building new homes or additions can get disaster-fortification guidelines from the Institute for Business & Home Safety (www.ibhs.org), a group funded by the insurance industry. Go to the "Fortified... for safer living" section of the site at www.ibhs.org/property_protection/default.asp?id=8 and enter your ZIP code for recommendations for your region. Though those measures can add 3 to 5 percent to construction costs, your home will be more likely to weather a disaster with less damage, according to Tim Reinhold, vice president of engineering at IBHS.
How can you safeguard an existing home? Here are some practical upgrades you can make right now or as part of a roofing, siding, or other remodeling project.
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