Even If You Live Inland in Massachusetts, Hurricanes Can Damage Your Property

By Richard A. McGrath, CIC, LIA

That Hurricane Isaac was no Katrina is little consolation to the 13,000 homeowners whose homes were damaged or destroyed by the recent hurricane.

Damages from Isaac could top $1.5 billion.  That’s small in comparison with Hurricane Katrina, which caused $81 billion in damages in 2005, according to the National Hurricane Center.

While residents of the southeast United States worry about “hurricane season” for half the year – from June 1 through November 30 – those of us living in the northeast tend to think of hurricanes as something we see on TV.

But hurricanes can cause a great deal of damage to homes in Massachusetts, too, and homeowners should make certain their homes are adequately protected.

In 2011, Hurricane Irene killed 56 people and caused $19 billion in damage to the United States, making it one of the most expensive hurricanes ever.  Although downgraded to a tropical storm by the time it hit Massachusetts, it caused flooding, washed out roads, power outages and other damage from western Massachusetts through Cape Cod.

The New England hurricane of 1938 killed up to 800 people, damaged or destroyed more than 57,000 homes and caused an estimated $4.7 billion in property losses, based on 2012 dollars.  Early settlers in the Massachusetts Bay Colony were hit by an even more intense hurricane in 1635 and there have been other hurricanes in Massachusetts throughout history.

What Is A Hurricane?

A hurricane is a tropical storm with winds moving at a speed of at least 74 miles an hour – faster than the speed limit on a major highway.  It can extend over an area more than 400 miles wide and its winds can reach up to 160 miles an hour.

As dangerous as a hurricane’s winds may be, coastal properties are even more at risk because of the potential for storm surge, which can create waves up to 20 feet high over an area of up to 100 miles.

In other words, hurricanes should be taken seriously, even if you live in Massachusetts.  When a hurricane is coming, homeowners are typically advised to board-up their windows and, if it is severe enough, evacuate the area.  But, even before a hurricane is headed your way, it is prudent to make certain you have the insurance coverage you’ll need to protect your property and your family.

All homeowners should take precautions to protect their homes, but those in high-risk areas may need two separate insurance policies: homeowner’s insurance, which covers wind damage caused by a hurricane, as well as fire and other damage, and flood insurance, which covers water damage caused by flooding or overflow of surface water runoff.

Even with both policies, some types of damage are not covered.  Coverage is limited for damage caused to trees and scrubs, although if a tree or limb crashes into your home, the damage will be covered.  Deductibles for damage vary greatly.

Damage to personal property, damage caused by blackouts, remediation of mold resulting from exposure to water, and food spoilage caused by a power outage may be covered by some policies, but not all of them.  If, for example, you own valuable artwork that is susceptible to damage caused by dampness, you will need supplemental coverage to protect it.

As we discussed in a previous column, some insurers have completely eliminated coverage for mold damage because of a significant increase in the number of lawsuits filed alleging bodily injury or property damage resulting from mold.

However, most policies will cover mold, wet rot and other issues that result from covered causes, but not when it results from ongoing conditions.  In other words, if you neglect to fix a problem that’s causing mold, it likely will not be covered, but if mold results from hurricane damage and you address the problem quickly, it most likely will be covered.

To avoid having to pay out of pocket for mold damage, be certain to read your policy carefully and talk to your agent about closing any gaps.  Also, try to prevent mold damage by addressing water damage quickly.

Your car or other vehicle, or a rental car may also be damaged by wind, water, tree limbs or the collapse of a building during a hurricane.  The damage will be covered by your auto insurance policy, but only if you have “other than collision” coverage or comprehensive coverage.

Commercial Property

While commercial property insurance typically covers damages or loss caused by a windstorm, it typically excludes “loss or damage to the interior of any building or structure, or the property inside the building or structure, caused by rain, snow, sand or dust, whether driven by wind or not, unless the building first sustains wind or hail damage to its roof or walls through which the rain, snow, sand or dust enters.”

Damages caused by flooding are also typically excluded from commercial property coverage, but flood insurance can be purchased through the National Flood Insurance Program.

While coverage for commercial property can be complicated, businesses also have more choices than consumers.  For example, they can purchase a percentage deductible endorsement in which they pay a small percentage of damages out of pocket.  The percentage is typically 1, 2 or 5 percent; the higher the percentage, the lower the insured’s premiums will be.

Each year, about 100 tropical disturbances develop over the Atlantic during hurricane season and about 25 of them become tropical depressions.  About 10 become tropical storms and six of the 10 become hurricanes.  Typically, only a couple of hurricanes a year hit the east coast of the United States and they rarely cause damage to the northeastern United States.

However, it does happen.  The odds of Massachusetts being hit by a hurricane may be low, but so were the odds of Sturbridge being hit by a tornado. Talk to your insurance agent to make certain you are adequately protected.

Richard A. McGrath, CIC, LIA is President and CEO of McGrath Insurance Group, Inc. of Sturbridge, Mass.  He can be reached at rmcgrath@mcgrathinsurance.com.

This article is written for informational purposes only and should not be construed as providing legal advice.