One of the joys of living in South Florida is being near the water. But as professional Miami insurance lawyers, we also know that one of the downfalls when it comes to that very thing is the cost of homeowners’ insurance on that waterfront property. Before you buy that tropical paradise, make sure you know the insurance implications.
One of the downsides to owning a home in an area at risk of hurricanes is that is can be more complex and quite a bit more expensive than a policy in another area of the country. That is why it’s imperative to understand the insurability of the home before buying it. Premiums that can add several thousand dollars to the cost of your home each year may make your tropical paradise cost prohibitive.
Shop the Local Insurance Companies
Coverage and premiums vary from insurer to insurer. Florida’s Office of Insurance Regulation has a good tool to comparison shop for premium estimates. These estimates are based on the type and date of construction, the value of the home, any mitigation features it may have, and the amount of the deductibles. In general, premiums will vary based on these variables.
Wind Mitigation Inspection
In addition to your standard home inspection, also ask for a wind mitigation inspection. This will give information based on the roof, the construction elements, and whether the home has impact glass or hurricane shutters. According to experts, premiums to ensure a home without wind mitigations features can be nearly four times that of one with these features.
Will You Require Flood Insurance?
If the home is located in certain flood zones, the mortgage lender will require flood insurance coverage in addition to a homeowners’ policy. This may be purchased through the National Flood Insurance Program. Some private insurers have also started to offer flood insurance. Check with the seller. Some older National Flood Insurance policies may be grandfathered and assumed by the buyer.
Check the CLUE Report
The Comprehensive Loss Underwriting Exchange, or CLUE, is a database where insurers offer information about claims in order to identify a property’s risks. This can alert you to any potential problems. Unfortunately, you can only order a CLUE report if you own the property. You may wish to ask the seller to order a report for less than $20 from the CLUE Home Seller’s Disclosure Report page.
Completely Understand the Insurance Company’s Windstorm Coverage
Although you no longer must get a separate windstorm damage policy, insurers vary greatly on coverage, deductibles, and premiums. Deductibles are usually substantially higher for hurricane damage and are usually based on a percentage of your coverage. You will want to understand how this would affect you in the case of a hurricane damage claim.
If you need further information about your insurance rights as a homeowner in hurricane-prone South Florida, call our insurance lawyers at Korin Law, P.A.