There are cases where a few shingles fly off the roof and the fence tilts, and when you call the insurance company, you hear that the deductible is $17,000. You might wonder where the usual $1,000 deductible went.

The reason is simple. Florida homeowners insurance has a separate hurricane deductible in addition to the standard deductible, and this is usually set as a percentage rather than a fixed amount.

According to the Florida Department of Financial Services (CFO) consumer guide, insurers must offer hurricane deductible options of $500, 2%, 5%, or 10%. However, if the home insurance amount is over $250,000, the $500 option does not have to be offered.

Here, the basis for the percentage is important. It is based on Coverage A, which is the insurance limit for the building itself, not the home value or claim amount.

If the terminology is unfamiliar, think of it this way: Coverage A is the maximum amount the insurer will pay to rebuild the house if it is completely destroyed.

For example, if Coverage A is $350,000 and the hurricane deductible is 5%, then the deductible is $17,500. If the damage is $15,000, there will be no money received from the insurance company.

This is why many people raise their deductibles to lower their premiums, but I advise you to check this carefully with a calculator. Saving a few hundred dollars on premiums could mean needing to prepare tens of thousands of dollars in cash for significant damage.

Legally, insurers must also display the percentage deductible as a dollar amount. You can find the numbers on the Declarations page of the renewal documents under the Hurricane Deductible section.

So when does the hurricane deductible apply? Florida law (627.4025) specifies this period quite clearly.

It starts when the National Hurricane Center issues a hurricane warning for any area in Florida. It ends 72 hours after the last hurricane watch or warning issued for Florida is lifted.

In simple terms, even if the warning is only for the southern tip of Florida and not our neighborhood, the period still begins. Any wind damage that occurs during this time will be subject to the hurricane deductible.

Another condition is that the storm must have been declared a hurricane by the National Hurricane Center. If the damage occurred during a tropical storm, the standard deductible may apply, so check your policy.

There is also a favorable regulation. The hurricane deductible can only be applied once per year (January to December) within the same insurance company or group.

An example provided by the CFO is easy to understand. Assume a $200,000 home with a 2% deductible, which would be $4,000, and a standard deductible of $1,000.

If the first hurricane damage is $2,000, there will be no insurance payout, but this $2,000 will be recorded as the deductible, leaving a remaining deductible of $2,000. If the second hurricane damage is $5,000, you would receive $3,000 after subtracting the remaining $2,000.

From the second hurricane onward, the larger amount between the remaining hurricane deductible and the standard deductible will apply. If the hurricane deductible is fully used, only the standard deductible will apply to any remaining hurricane claims for that year.

Many people overlook this point: even if the damage is less than the deductible, you must still file a claim.

Filing a claim ensures that the insurance company records that amount, and it will be deducted from the deductible for the next hurricane in the same year. If you don't contact them, there will be no record.

Be cautious when switching insurance companies. If you move to a different group of insurers mid-season, any accumulated deductibles will not be recognized, and you will have to bear the full deductible amount for the next claim.

The claim deadlines have also shortened. For damages occurring after March 1, 2023, the initial claim must be filed within one year, and any additional claims within 18 months.

Another area of common misunderstanding is flooding. Just because the hurricane deductible applies does not mean flood damage will be covered.

Standard homeowners insurance does not cover flooding. Indoor damage from rainwater is only covered if the wind first creates a hole in the roof or windows.

Flooding must be prepared separately through the federal NFIP or private flood insurance, and there is usually a 30-day waiting period for new NFIP enrollments. This means it's too late to enroll after a storm approaches.

Surplus lines products may have different deductible structures and are not protected by the Florida Insurance Guaranty Association (FIGA). Check your policy documents for this indication.

The Inflation Guard option is also worth considering. This feature automatically increases the insurance limit each year, and the percentage deductible also rises accordingly.

The order I recommend to readers is as follows: first, check the hurricane deductible in dollars on your renewal documents and see if you can set aside that amount as an emergency fund.

Next, if damage occurs, even if it is less than the deductible, take photos and obtain a claim number. It's better to start looking into flood insurance now, as the season is nearing its end.

Conditions vary by policy, and the best choice may differ based on individual circumstances. Before changing your deductible, I recommend asking your agent to compare the actual amounts.