Insurance 101

Question 1

What Insurance Do I Actually Need?

Accepted Answer

The insurance you need depends on your specific situation — your assets, your risks, and your financial circumstances. At a minimum, most people should consider auto insurance (required in most states), homeowners or renters insurance to protect their property, and health insurance. If you own a business, commercial coverage is also important. The best way to determine what you need is to speak with a licensed insurance professional who can review your situation and help you identify any gaps in coverage.

Question 2

What Is a Deductible?

Accepted Answer

A deductible is the amount you agree to pay out of pocket before your insurance coverage kicks in for a covered claim. For example, if you have a $1,000 deductible and file a claim for $5,000 in damage, you would pay the first $1,000 and your insurance would cover the remaining $4,000 (subject to your policy limits and terms). Generally, choosing a higher deductible lowers your premium, while a lower deductible means higher premiums. It's important to choose a deductible you can comfortably afford to pay if you need to file a claim.

Question 3

How Does Homeowners Insurance Work?

Accepted Answer

Homeowners insurance is a package policy that typically includes several types of coverage: dwelling coverage (for the structure of your home), personal property coverage (for your belongings), liability coverage (if someone is injured on your property), and additional living expenses (if you need to temporarily relocate after a covered loss). When you file a claim, your insurance company will investigate the loss and, if covered, pay to repair or replace the damaged property — minus your deductible. Coverage limits, exclusions, and deductibles vary by policy, so it's important to review your policy carefully.

Question 4

What Does Auto Insurance Cover?

Accepted Answer

Auto insurance typically includes several types of coverage: liability coverage (for damage or injuries you cause to others), collision coverage (for damage to your vehicle from an accident), comprehensive coverage (for non-collision damage like theft, weather, or vandalism), uninsured/underinsured motorist coverage (if you're hit by a driver without adequate insurance), and medical payments coverage (for medical expenses after an accident). Most states require a minimum level of liability coverage. The specific coverages and limits in your policy will determine what is and isn't covered.

Question 5

Do I Need Flood Insurance?

Accepted Answer

Standard homeowners and renters policies typically do not cover flood damage — this is one of the most common and costly misconceptions in insurance. If you live in a designated flood zone, your mortgage lender may require you to carry flood insurance. Even if it's not required, flood insurance is strongly recommended for many Gulf Coast and low-lying properties. Flood insurance is available through the National Flood Insurance Program (NFIP) and some private insurers. There is typically a 30-day waiting period before a new flood policy takes effect, so it's important not to wait until a storm is approaching.

Question 6

What Does Wind & Hail Insurance Cover?

Accepted Answer

Wind and hail insurance helps cover damage to your home and property caused by windstorms, hailstorms, and related severe weather. In some coastal and storm-prone areas, wind and hail coverage may be excluded from a standard homeowners policy or subject to a separate deductible. A windstorm policy or endorsement provides coverage specifically for this type of damage. If you live in a hurricane-prone region, it's especially important to understand whether your homeowners policy includes wind coverage or whether you need a separate policy.

Question 7

How Do Hurricane Deductibles Work?

Accepted Answer

A hurricane deductible is a special deductible that applies when a named hurricane causes damage to your home. Unlike a standard deductible (which is typically a flat dollar amount), hurricane deductibles are often calculated as a percentage of your home's insured value — commonly 2% to 5%, though this varies by policy and state. For example, if your home is insured for $300,000 and you have a 3% hurricane deductible, you would pay the first $9,000 of a hurricane-related claim out of pocket. Understanding your hurricane deductible before storm season is critical, especially in Gulf Coast states.

Question 8

How Much Insurance Coverage Do I Need?

Accepted Answer

The right amount of coverage depends on what you're protecting. For homeowners insurance, your dwelling coverage should be enough to rebuild your home at current construction costs — not just its market value. For auto insurance, liability limits should be high enough to protect your assets if you're found responsible for a serious accident. For business insurance, coverage needs depend on your industry, revenue, number of employees, and specific risks. A licensed insurance professional can help you evaluate your coverage needs and identify any gaps.

Question 9

What Should I Do Before Hurricane Season?

Accepted Answer

Before hurricane season, review your homeowners, wind, and flood insurance policies to understand your coverage, deductibles, and limits. Make sure your dwelling coverage reflects the current cost to rebuild your home. Confirm whether you have separate flood insurance and understand your hurricane deductible. Document your personal property with photos or video and store copies of your policy documents in a safe, accessible location. If you have questions about your coverage, speak with a licensed insurance professional before storm season begins — not after a storm is already approaching.

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