Does Homeowner’s Insurance Cover Tornado Damage? Tornado Insurance Coverage Cost

After Tornado, Victims Fear Insurers Will Spin Them

When big disasters attack area, homeowners, and victims worried about covering claims because most insurance companies avoid claims related to disaster by excluding various happening. Here we discuss a common question ‘does homeowner’s insurance cover Tornado damage?’ and tornado insurance coverage cost.

Before 8 years, when Hurricane Katrina decimated the southern coast of the U.S., many insurance companies denied paying for homeowners’ claims because the losses were caused by flood and not due to wind and rain. In homeowners’ policy, wind and rain damage were covered but the flood was not included therefore people have to bear huge loss.

A similar incidence was also at the time of the Eyjafjallajökull volcano in Iceland reported. Many flights were cancelled due to an active volcano which damages about $1.7 billion only for airlines. Insurers denied paying for cancelled flights because they argued that they are responsible only for damaged equipment and not for cancelled flights.

Agricultural losses will not be covered because the congregation of ash in the air is too low which could not include in a claim. Business claims from undelivered packages will also be denied because the damage was not material. Airlines and airports had also faced the same situation because there wasn’t any physical damage to their properties.

Insurers also play tricks with their consumers. The policies are often so confusing that homeowners and even well-educated may not understand their coverage. Insurers generally underestimate the cost of repairs and tell homeowners that the damages aren’t high enough to meet deductibles. For example, if any homeowner has a policy of $10,000 deductible then insurer’s contractor might be told that the cost of replacing a repair is only $5,000 which is very below for the deductible. In this way, the insurance companies or agents avoid responsibility for covering the repair.

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Moreover, insurers are now paying percentage basis deductibles rather than fixed rate. For instance, if someone is eligible for $500 deductible years ago, they might have to pay 5% deductible now for the repair of $25000. It simply means that homeowners have to pay more out of their pocket instead of fixed payment.

Although policyholders in high- risk locations, may pay more for coverage and repairs. Before enrolling with any policy, it is necessary to know every essential feature and coverage events so that it will not put in a loss in future when disaster happen. If possible, take an extra coverage for flood also which will protect against flood calamity and homeowners’ policy against wind and fire.

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