Hail damage is a significant risk to homes, autos, and other property owned by your clients. Like other forms of weather damage, it is typically covered in some way by a homeowner’s insurance policy. The application of coverage varies depending on the state and nature of the policy. Agents should carefully check the policies of their clients to ensure they have sufficient coverage for wind and hail damage.
Here are four questions to consider during hail coverage discussions with your clients:
When and where is hail the greatest risk? Hail damage most commonly occurs during the warm months of the spring and summer. This is due to the increase in thunderstorm activity caused by higher temperatures and humidity.
According to a 2017 report by Verisk, hail activity is most concentrated in Midwestern states such as Texas, Illinois, and Kansas.
That same report revealed the staggering scale of hail damage, with over 10.7 million homes and properties reporting hail damage in 2017. Even conservative estimates place the total cost of damage in the billions.
Does my client need additional insurance (beyond homeowners) to protect against hail damage?
If your client is NOT covered for wind/hail damage, they should consider getting coverage either through homeowners or a specialized wind and hail coverage policy.
While these policies are often provided through state agencies, there are specialized options on the market for more nuanced coverage needs.
Can hail damage be prevented? Existing structural damage can be exacerbated by hail, so you want to keep your home in tip-top shape.
Start by inspecting the current state of your home, paying particular attention to skylights and roof fixtures. Damage and age may make these areas particularly vulnerable to hail damage.
It’s also advisable to install a hail-resistant roof. While there isn’t a material which is completely impervious to hail, class 4 shingles and other roofing made of metal and synthetic slate are more resistant to impact damage.
Most importantly, your clients need the right insurance to cover the costs of repairs as well as any liability from injuries during the repair process.
How does coverage for hail damage vary among policies?
1. Coverage typically does not rise due to hail damage occurring, but clients in hail prone areas typically pay higher premiums due to the increased risk. Hail is an act of nature, so insureds won’t be penalized by their insurance for its occurrence on a case by case basis. However, your client should expect to pay a higher premium or deductible in hail prone areas.
2. Hail claims often have percent based deductibles. Depending on the level of risk, a deductible may be as high as 5% of the insured value of the home. Advise your clients to carefully consider the payout and deductible structure of their policy to ensure they make a decision which fits their needs.
3. Cosmetic damage may not be covered. Major storms like Hurricane Katrina pushed the insurance industry to create exclusions for cosmetic damage in their policies.
If the damage is purely aesthetic and causes no functional issues, the insured’s policy may exclude it from coverage.
Agents should carefully review policies with their clients to ensure they understand the scale and limitations of their hail damage coverage.
Our team here at Quaker Special Risk can work with you to create a policy that matches the unique needs of your clients. Reach out today to get connected with one of our experts!