The 2012 hurricane season has begun: Do you understand your hurricane deductible?

Insurance Information Institute: If you live in a coastal state, it’s time to pull out your homeowners insurance policy and see if you have a hurricane deductible. This will determine the amount of money you must pay out-of-pocket before your coverage kicks in if there is a hurricane. Hurricane deductibles are clearly listed in your policy, according to the Insurance Information Institute (I.I.I.)

“With hurricane season beginning this month and lasting until the end of November, it is important for homeowners to determine whether a hurricane deductible applies to their policy,” said Jeanne M. Salvatore, senior vice president and consumer spokesperson for the I.I.I. “Hurricane deductibles were put into place to make more private insurance coverage available at competitive rates. With the increase in coastal development, as well as the risk of more severe and costly hurricanes, consumers are now sharing more of the potential catastrophe risk with insurance companies.”

Eighteen coastal states allow insurers to incorporate hurricane deductibles into their homeowners policies: Alabama, Connecticut, Delaware, Florida, Georgia, Hawaii, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Jersey, New York, North Carolina, Rhode Island, South Carolina, Texas and Virginia.

...Hurricane deductibles are triggered only when certain criteria are met (e.g., after the National Weather Service has determined a Category 1 storm made landfall). The hurricane deductible triggers vary by state and insurer and usually apply when the NWS officially names a tropical storm, declares a hurricane watch or warning, or defines a hurricane’s intensity. Due to these differences, homeowners should check their policies and speak to their agent or insurance company representative to learn exactly how their particular hurricane deductible works....

A Miami trailer park devastated by Hurricane Andrew in 1992, FEMA photo