In the aftermath of Hurricane Ian, businesses and homeowners will look to secure insurance recovery for the significant property damage and business income losses left in its wake. Below are tips and resources to consider when seeking insurance coverage for losses resulting from Hurricane Ian.
Flood Insurance
Individuals impacted by Hurricane Ian will generally have claims relating to flooding of their homes and/or automobiles. Flooding from a hurricane can cause extensive damage and potentially leave a home completely uninhabitable. Unfortunately, only 20% of impacted homes may have flood coverage.
If a home is flooded, the entire floor of flooding must be cleared of impacted carpet/flooring, cabinets, drywall up several feet, appliances, and personal property. Construction to repair flooded homes is expected to take five to twelve months and individuals will need to obtain temporary housing for a prolonged period of time.
Individuals with flood insurance under the National Flood Insurance Program (NFIP) should file a claim through their insurer. NFIP policies are often managed by an individual’s regular home insurer. The form policy generally covers up to $250,000 to repair/replace real property and $100,000 to repair/replace personal property. Usually, an advance of $5,000 to $10,000 is available, if needed, and homeowners need to follow NFIP guidelines to avoid mold (which is not covered).
Individuals should obtain complete copies, including endorsements, of all homeowner and flood policies and file claims under both policies. FEMA information on filing a NFIP flood claim can assist in this process. A proof of loss is generally required within 60 days of date of loss.
Under the NFIP standard policy, certain types of real property and all personal property are covered only at “actual cash value” or depreciated value, rather than replacement value. This FEMA flood insurance guide provides a summary of the coverage available under the form NFIP policy.
NFIP insurance may also pay for the increased cost of compliance with codes up to $30,000. Generally, if more than 50% of the value of a home was damaged, there may be newer code requirements that must be met. Such codes may require raising the elevation of a home, demolishing it, or relocating to a new site.
Auto Insurance
Automobile damage from flooding is generally covered under the comprehensive coverage portion of the policy. Individuals should obtain a complete copy of their automobile insurance and submit a claim to their automobile insurer.
Homeowners Insurance
Homeowners insurance may cover other types of damage, such as wind, but generally excludes flood. Homes may be partly damaged by wind and flood. The homeowner’s insurer may cover only the portion of the loss caused by wind, and not damage caused by a combination of wind and flood. Claims should be made immediately so an adjuster can inspect the property to determine if any damage is covered by the homeowner’s policy.
SBA Disaster Loans
Even with insurance, most individuals can have a significant gap between their actual costs from the disaster and the insurance proceeds.
The Small Business Administration provides low interest (generally under 3.5%) long term loans to individuals impacted by disasters up to $200,000 to repair/replace real property and $40,000 to repair/replace personal property on their primary residence. Information on SBA disaster loans can be found on the SBA site.
Most people can demonstrate the economic ability to repay an SBA loan and qualify for the loan. Collateral is not necessary to qualify for an SBA disaster loan, i.e., the home does not need to have sufficient equity to cover the loan. This fact sheet about qualifying for the program may be helpful.
All impacted individuals should go through the process of applying for an SBA loan, because it impacts the ability to obtain certain FEMA assistance (that does not need to be repaid).
FEMA Disaster Assistance
FEMA aid is generally considered emergency assistance of last resort. FEMA aid is available to help individuals find temporary housing and be able to return to their primary residence, as well as for repair, replacement, housing construction, and other basic needs. The cap on assistance is about $33,000 per household.
Individuals have 60 days from the date of the disaster to apply for FEMA disaster assistance, although the date is expected to be extended. Every impacted individual should immediately file for aid at disasterasistance.gov. This information from FEMA on Ian can provide additional guidance.
FEMA assistance is generally not available if there is any other funding source available, including insurance, an SBA loan, or private or other charitable donations. However, FEMA will advance immediate funds to individuals that they may need to pay back if those costs are ultimately covered by insurance or paid by another source.
Generally, FEMA temporary housing assistance is available regardless of income for three months for homeowners and one month for renters, but that may be extended based on individual circumstances.
Tenant’s Issues
Individuals may have issues with their landlords involving the condition of the damaged premises. The lease governs the tenant’s rights and generally requires that actions be taken in writing, such as a notice of termination. Individuals may need to negotiate with their landlords to delay or reduce rent, but ultimately it may be necessary to pursue legal action.
Replacing Original Documents
Individuals may need to replace original documents. Copies of insurance policies may be obtained directly from the insurers. Proof of insurance may be available from a broker, who can assist with obtaining a full copy of any policy. Attorneys that assisted with home closings may have copies of deeds, mortgages, plats of survey and real estate appraisals, often with pictures of the home.
Here are additional resources to assist with that process:
Tips on Hiring a Contractor
Individuals should be careful about selecting their contractors. Below are tips for hiring contractors for after-storm repairs:
Finding a Lawyer
Florida State Bar attorney referral service
Unemployment Assistance
Disaster Unemployment Assistance is available to Florida businesses and residents whose employment or self-employment was lost or interrupted as a direct result of Hurricane Ian. Individuals affected in the designated-disaster areas must file DUA applications by December 30, 2022.
Policyholder Help Library
United Policyholders Help Library
