Homeowners face challenges with insurance claims after Hurricane Helene

Homeowners across six states are filing insurance claims after Hurricane Helene caused significant destruction. Many claimants may find themselves without coverage due to recent changes in property insurance policies, which have increased rates and reduced coverage to offset underwriting losses from natural disasters.

Rick Tutwiler, a Tampa-based claims adjuster, stated that insurers have become "significantly tougher on hurricane claims," highlighting an era marked by exclusions and stricter policy terms. Moody's has estimated the property damage from Helene at $15 billion to $26 billion, but insured losses might only reach the lower end of forecasts, ranging from $5 billion to $15 billion according to John Neal of Lloyd’s of London.

A major issue is that typical home insurance policies do not cover flooding, and few homeowners carry separate flood insurance. Other contributing factors include higher deductibles for wind damage and restrictions on older roofs and interior water damage. Meg O’Toole Herman from Goosehead Insurance noted numerous calls from clients whose damages fall below their deductible.

Hurricane deductibles offer customers "reliable protection in areas prone to catastrophic storms," according to Tom Wilson of Allstate. However, these deductibles can significantly impact homeowners financially. For example, a 5% deductible on a million-dollar home means the owner pays the first $50,000 in losses.

The aftermath of Helene may lead to further premium increases for inland areas previously considered less vulnerable. Alexandra Glickman of Arthur J. Gallagher warned that small businesses and multifamily properties might face higher insurance costs as they rebuild.

The storm has highlighted gaps between flood risks and coverage; fewer than one in 100 households in heavily flooded inland counties have flood insurance. In Florida's Big Bend region, over 95% of homes lack such policies despite the state leading in flood insurance sales.

Michael Drake from Longboat Key managed to avoid major damage thanks to federal flood insurance but noted the severity of this storm compared to past experiences.

Legal battles could ensue as homeowners argue over coverage details with insurers who might limit payments even if damages aren't directly attributed to flooding. Amy Bach from United Policyholders indicated insurers' strategic efforts to minimize payouts for water damage.

Josh Darr from Guy Carpenter pointed out potential litigation if insurers attribute all damages solely to flooding despite strong winds accompanying Helene.

Two years after Hurricane Ian hit Florida, nearly 50,000 claims remain unresolved, including more than 18,000 with no payments made yet according to state data.