6 Tips to Financially Prepare for a Hurricane

Hurricane

 

The mention of hurricane preparedness about this time each year is typically directed at homes and businesses along coast lines and brings to mind long lines at home improvement centers for plywood and supplies. Coastal cities and towns typically get hit hardest by hurricanes. But while not a primary driver of insured loss, hurricane risk in inland states is not negligible, says Air Worldwide. The fallout from coastal hits can be damaging and deadly.

Air Worldwide, a risk modeling software and consulting services provider, outlined inland hurricane risk and post-landfall storm behavior in a 2011 study three years after Hurricane Ike trekked from Cuba, slammed into the Texas Coast and pushed upward into the Midwest and Northeast. Ike, the third costliest Atlantic hurricane in history, adds to historical evidence that winds and rain far from the hurricane’s original landfall location can cause property damage and loss of life.

While Galveston, Texas, took a hard hit and the Louisiana coast sustained significant damage, the storm’s turn inland impacted nearly a dozen states. Ike collided with another system moving through the Midwest and produced heavy rainfall and high winds all the way to the Northeast. The remnants caused $2.5 billion in damage and 26 deaths over seven inland states. Ohio reported 2.6 million power outages and $560 million in damages. When everything dried out, Ike caused $12.5 billion in damages.

Likewise, in 2011, Hurricane Irene left portions of Vermont and upstate New York in disarray, forcing governors of both states to declare natural disasters. Hundreds of miles away from her impact, Irene left behind high water that swept homes from their foundations and flooded the Catskills. Inland and along the East Coast, hundreds of thousands were without power.

Inland damage from hurricanes is nothing new − from 1950-2011, ISO’s Property Claims Services has issued losses in inland states for 14 storms − but the headlines tend to focus on coastal preparations. With high concentrations of residents, apartments hundreds of miles from the coast should always be prepared, says LeasingDesk Insurance President Ed Wolff.

Communities should not only take the necessary steps to protect property and people, but educate residents about the value of renter’s insurance.

“We are still very much in hurricane season, and it’s important for property owners, managers and residents to be ready for a devastating storm whether inland or at water’s edge,” says Wolff.

The Property Casualty Insurers Association of America offers steps to help property owners financially prepare for a disaster, no matter the location:

1. Conduct a yearly insurance policy review

Annual reviews with your insurance provider will help ensure adequate coverage and the ability to weather a catastrophic loss. Be aware of current costs associated with building new structures, and add at least 10-20 percent. Consider extended replacement cost coverage, which pays out a specified percentage above the dwelling coverage limit. Know the policy deductible.

2. Consider additional coverage like flood insurance

Standard insurance policies don’t cover losses resulting from floods, or even the failure of a sump pump and sewer backups. Owners could end up paying for repairs resulting from flooding out of their own pocket.

3. Stormproof your property

Make preparations to minimize damage resulting from severe weather. Doing so can reduce insurance costs and help speed the recovery process after a natural disaster. If it’s appropriate, consider things such as installing storm shutters or straps to secure roofs. If a hurricane is eminent, cover windows with plywood or shutters and place grills, patio furniture and other items that could become airborne during a windstorm indoors.

 

4. Keep important documents safe and inventory contents

Inventory items on property and photograph or shoot video of them. This will help quickly and easily account for important assets that need to be reported to your insurance carrier to ensure full compensation for a loss. Keep the inventory and your insurance policies in a safe place, such as a safety deposit box.

5. Prepare for power outages and inconveniences

As severe weather approaches, property staff and residents should fill gas tanks in case of evacuation, have cash on hand for emergencies and charge electronic devices. After a storm, insurers are often able to assist policyholders with proper coverage in paying for expenses such as temporary housing and food if the property is determined to be uninhabitable.

6. Watch out for scams

After a natural disaster beware of unlicensed contractors and scam artists who may be looking to cash in on your misfortune. It is natural to hurry to start repairs, but take the time to check the credentials of the businesses and individuals you hire to repair your property.

While taking steps to prepare for a hurricane or any other potential natural disaster, it’s a good idea to address the associated financial risk.

 


Contributing Editor, Property Management Insider
President, Ballpark Impressions, LLC

author photo two

Tim Blackwell is a long-time publishing and printing executive in the Dallas/Fort Worth area who writes about the multifamily housing and transportation industries. He has contributed numerous articles to Property Management Insider, and worked as a newspaper reporter in the D/FW area. Blackwell is president of Ballpark Impressions, and publishes the Cowcatcher Magazine. He is a member of the Fort Worth Chapter/Society of Professional Journalists.

Follow PMI


Property Management Insider is brought to you by RealPage. Learn more.

 

© RealPage, Inc. All trademarks are the properties of their respective owners. 1-877-325-7243 | Terms & Conditions | Privacy Policy | DMCA Notice | Sitemap