There is no place quite like New Jersey – the boardwalks, the beautiful beaches, the shopping. One could easily be swept up in nostalgia for a simpler time when serenity could be attained simply with sand between your toes and seashells in your pocket. For those of you who call New Jersey home all year round, you can attest that such beauty doesn’t come without a price. The nearly 150 miles of shoreline are nothing short of stunning on a sunny summer day but hurricane season brings a different feeling – vulnerability and exposure. New Jersey Homeowners Insurance is your number one defense.
Most likely the answer is yes. But that doesn’t mean it covers everything associated with hurricanes. Flooding is NOT. Every major wind storm is not a hurricane. It is always best to have a trusted insurance agent explain the terms of your policy. That way you know what you can expect and prepare for the case that you need to make a claim. (Keep reading to know what questions to ask.)
According to the National Weather Service, a wind storm becomes a hurricane when sustained winds of 74mph make landfall. Your hurricane deductible will have to be paid for any damages that occur 12 hours before the initial recorded 74mph winds and 12 hours after the last recorded 74mph winds. Note that while hurricane season is June to November, the brunt of the storms come through New Jersey between August and September.
No. Flooding is a separate event. You need to have flood insurance to cover damages from flooding. Sometimes you can buy flood insurance from a private insurer. Depending what flood zone you live in though, you may have to purchase it through the Federal Emergency Management Agency (FEMA).
This is where you are going to want to have crisp understanding of your policy. The terms within your policy determines the payout after a total loss of your home – Replacement Cost, Guaranteed Replacement Cost, Extended Replacement Cost or ACV. While these terms look similar, they don’t protect your home in the same way. Your agent can tell you the term used in your policy.
Guaranteed replacement cost means your insurance will pay whatever it costs to replace your home as long as you have not broken any of the company’s guidelines.
Extended replacement cost means insurance will pay replacement costs up to the policy’s limit plus an extra predetermined percentage.
Actual cash value (ACV) means that your insurance company will pay the replacement cost less depreciation.
A home damaged by covered incidents requires you to pay a predetermined deductible before your insurance kicks in. Because New Jersey is one of several states which has a high incidence of hurricanes, insurance companies will have a hurricane deductible which is different than the standard peril deductible which covers standard events. The regular deductible/standard perils deductible will usually be a specific dollar amount, for example, you may have a $3000 deductible. 1-10 percent of your home’s total quoted replacement cost is how much your hurricane deductible will be. Consider the following as an example. Your home’s quoted replacement cost is $625,000. The terms of your policy state that your hurricane deductible is 5% of that. You will have to pay the first $31,250 towards your home before the insurance will kick in.
Despite being an at-risk state for extreme weather, New Jersey has managed to maintain average home insurance rates at or below the national average. How could that be? Well as we discussed earlier, New Jersey is quite exquisite. Its beauty and convenient proximity to major US hubs, real estate remains on the higher end. Expensive real estate attracts more businesses to the NJ market. Thanks to the macroeconomic laws of supply and demand, more competition in the market drives prices down (or at least holds them stable).
There are usually legitimate ways to reduce your premiums without sacrificing appropriate coverage. The standard options are to bundle your policies or increase your deductible. If you storm proof your home, your insurance company may reduce your premium. There are many ways to storm proof your house. Have your house raised, install shutters, have your roof, garage and doors reinforced and have lawn furniture stored or restrained. Don’t let price cutting gimmicks lure you in. If you actually need to file a claim, you are going to want easy access to appropriate funds.
Coast Insurance Quotes works with only established and reputable insurance agents and insurance companies. We can put you in touch with a professional that will assess your exposures and advise you on your options. We provide personal insurance and commercial insurance for all of New Jersey, including Belmar, Ocean City, Somers Point, Wildwood, and Longport. Call us today at 203-769-9565.