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Once the fury of Superstorm Sandy subsided, millions of stunned residents in New York, New Jersey and points north and west began digging out their homeowners insurance policies to assess their financial damage from this once-in-a-lifetime storm.
By now, the images and loss estimates are etched in our collective memory: scores of deaths, an estimated $10 billion in insured losses, $20 billion in overall losses and another $30 billion in lost business revenue.
But for many recovering from their first brush with such a powerful storm, the most unsettling post-Sandy fear is: Does my homeowners insurance cover a hurricane or storm like this?
Unfortunately, the answer can only be found in your homeowners insurance policy. That's because property and casualty companies have been adapting their policy terms in recent years due to unusual storm frequency and impact on areas not normally considered hurricane country.
Quick refresher: A typical homeowners policy includes a deductible, usually $500 or $1,000, that you must pay toward your damages before your insurance benefits kick in.
But increasingly, insurers have added a second deductible -- which can be considerably bigger -- that applies only if your home is damaged by a hurricane. Your hurricane deductible is typically in a range of 1 percent to 5 percent of the value of your home, according to the Insurance Information Institute, and could be even higher. That means if your home is worth $300,000, your hurricane deductible would likely cost you between $3,000 and $15,000, and possibly more.
So what triggers this hurricane deductible? Some policies require an official hurricane designation, some go on wind speed, and still others kick in when a tropical depression is involved.
Because Sandy's sustained winds apparently skirted the Category 1 criteria of 75 miles per hour when they hit the Empire State (the National Hurricane Center downgraded it to a "post-tropical cyclone"), New York Gov. Andrew Cuomo declared that New York homeowners would not be subject to hurricane deductibles. Whether all insurance companies will agree with his line call remains to be seen.
If you have questions about whether you will be subject to a hurricane deductible in your home insurance, contact your agent/broker or your state's Department of Insurance.
Follow me on Twitter: @omnisaurus.
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