TALLAHASSEE, Fla. – Thousands of Floridians will be getting insurance checks soon to help fix damage from Hurricanes Charley or Frances, but many will be surprised to learn how much of the repair bills they must pay themselves.
Following Hurricane Andrew in 1992, insurers doing business in Florida were allowed to charge dramatically higher deductibles on hurricane damage claims. Where homeowners are used to paying $500 or $1,000 deductibles for other damage – from a tornado, for instance – they now will pay 2 percent of the value of their home or more for their hurricane deductible.
For homes worth more than $100,000, that means owners would be responsible for $2,000 or more in repair costs.
The change was made in 1996, one of many concessions state lawmakers made to insurers to keep them selling hurricane coverage in Florida. Most residents making claims because of Charley or Frances are doing so for the first time since then.
“People don’t realize they have a large deductible,” said Tom Gallagher, Florida’s chief financial officer. “I really think that’s a surprise people aren’t expecting.”
Floridians who were damaged by both Charley and Frances face an additional difficulty – a double deductible because insurers require separate claims and deductibles for damage from separately named storms.
Gov. Jeb Bush said the double deductible is something that might need to be changed. “That could be an issue that the Legislature looks at,” he said Tuesday.
Insurers say the higher deductibles keep rates lower than they otherwise would be and that, along with premium increases since Andrew, have made it possible to offer hurricane coverage in Florida.
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