With the recent severe storms that hit our region, many property owners are learning that they may not have the coverage they thought they had when it comes to hail damage. Given the frequency and severity of hail storms in the Midwest, many insurance carriers have begun to reduce or remove coverage for hail damage. If your agent is not addressing and educating you about these endorsements, you may have much less coverage than you think. Below is a list of several key endorsements and exclusions that insurance carriers commonly will use to minimize their exposure to hail, along with an explanation of how they affect your coverage.
- Hail or Windstorm Exclusion – This endorsement is by far the most drastic stance a carrier can take by all together excluding any claim for a hail storm or windstorm.
- Hail or Windstorm Percentage Deductible Endorsement - As its title suggests, this endorsement imposes a percentage deductible on recovery for loss caused by windstorm or hail instead of the standard property deductible. The amount of the deductible is the specified percentage of the limit of insurance applicable to the damaged property.
- Actual Cash Value Loss Settlement for Hail or Windstorm Losses Endorsement – This endorsement alters your policy to only pay out the actual cash value of a hail claim even if the rest of your policy is written on a Replacement Cost basement. Depending on the age of the roof, this could be very significant.
- Cosmetic Damages Exclusion (Roofing Materials) – This exclusion limits what is considered an occurrence during a hail claim. If your policy has this exclusion it will only pay out for a hail claim if the roof is deemed to no longer be able to prevent the entrance of weather-related or other elements to the same extent that it did before the marring, scratching, denting, pitting, or discoloration occurred. If the roof is simply cosmetically damaged, but can still function normally, your policy will not pay.
- Per-Occurrence vs Per-Property Hail Deductible – The difference between these two deductibles can be significant. Under a Per-Occurrence deductible, no matter how many properties are affected, a single deductible applies to a single hail storm. With a Per-Property deductible, even if multiple properties are damaged by the same storm system, the deductible will be applied to each property.
Be sure to double check your hail coverage (or lack thereof) before the next storm blows in. Contact the trusted advisors at Hausmann-Johnson Insurance if you have questions concerning hail damage or how severe storms can affect your property.
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