What You Should Know About Hurricane Deductibles

iStock_000010149937LargeIn nineteen states, including Rhode Island, Massachusetts, and Connecticut, insurance companies offer a special deductible for hurricane damage. A hurricane deductible applies to damage caused solely from a hurricane as categorized by the National Weather Service. Hurricane deductibles are only triggered when a named hurricane makes landfall in the state where the insured property is located. A deductible would not go into effect for a tropical storm, blizzard, or any other weather phenomenon other than a hurricane.

Hurricane deductibles are usually set between 1% and 5% of the dwelling limit – the amount for which a home is insured. As an example, if your home is insured for $300,000 and your policy has a 5% hurricane deductible, you would be responsible for the first $15,000 in hurricane damage. Hurricane deductibles are not permitted to exceed 5% of the dwelling limit.

While hurricane deductibles are not mandatory, many insurers make this a condition for coverage near the coast. As an agency that provides homeowners insurance to many coastal homes, OceanPoint also represents carriers who specialize in coastal coverage that do not require hurricane deductibles. Depending on the homeowner’s unique set of circumstances, we will recommend a coverage plan best suited for our client, which may or may not include a hurricane deductible.

For more information on hurricane deductibles or if you have any questions about your homeowners policy please call OceanPoint Insurance at 401.847.5200.

New Law Modifies Flood Insurance For Secondary Homes

In April 2015, Congress began implementing the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA), which repeals some provisions of the Biggert-Waters Flood Insurance Reform Act of 2012, modifies others, and makes additional changes to the National Flood Insurance Program (NFIP).

The new law limits the rate of increase for individual premiums to 18%, while increases for average rate classes are capped at 15%. However, non-primary homes, such as secondary or vacation homes or rental properties, are subject to a 25% annual premium increase. In addition to premium increase, HFIAA requires a $25 surcharge on all policies for primary residences, and a $250 surcharge on all other policies, including non-primary residences.

FEMA defines a non-primary residence as a building that will not be lived in by an insured or an insured’s spouse for more than 50% of the 365 days following the policy effective date.

To determine the correct HFIAA surcharge, insurers must now validate primary residence eligibility. Flood insurance providers sent a letter and Verification of Primary Residence Status form to current policyholders to verify their primary residence.

To make sure you only receive the $25 HFIAA surcharge, policyholders must submit one of the following with the form:

  • Drivers license
  • Automobile registration
  • Proof of insurance for a vehicle
  • Voter registration
  • Documents showing where children attend school
  • Homestead Tax Credit form for primary residence

Because this premium surcharge is mandated by law, if documentation is not provided your renewal premium will automatically reflect the $250 HFIAA surcharge. We strongly encourage you to review your renewal policy to confirm that it is being rated as your primary residence.

If your policy is coming up for renewal and you have not received a letter and form, please contact your OceanPoint agent. If you have any questions, please do not hesitate to contact the office at 401.847.5200.

Boating Safety Tips Everyone Should Know

shutterstock_15657421Did you know that Rhode Island requires boaters to have a Boater Safety Education Certificate, not a boating license? Anyone born on or after January 1, 1986, is required to pass an approved boater education course before legally operating any vessel powered by a motor of more than 10 horsepower. In addition, anyone operating a personal watercraft, or jet ski, regardless of age, must have passed an approved boater education course.

In addition to reviewing your local boating laws, it’s important to always practice boating safety. We have provided some tips to help ensure you have a safe and enjoyable trip:

  • Be weather-wise. We are at the start of hurricane season, and you should always check local weather conditions before departure.
  • Download the U.S. Coast Guard’s (USCG) boating safety app. The USCG released a mobile app last month that features: latest safety regulations, ability to request emergency assistance, file a float plan, and more.
  • Develop a float plan. Always be sure to let someone else know your plan, including where you’re going and how long you’re going to be gone.
  • Have proper lifejackets onboard. The majority of drowning accidents result from boaters not wearing a lifejacket. Make sure everyone onboard has a lifejacket and that it properly fits.
  • Avoid alcohol. The probability of being involved in a boating accident doubles when alcohol is involved.
  • Consider a free vessel safety check. The USCG offers complimentary boat examinations to evaluate the safety of your vessel.

For more information on boating safety or to inquire about marine insurance, please call OceanPoint Insurance at 401.847.5200.