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2018 Hurricane Season Preparation by Patrick McCarthy

2018 Hurricane Season Preparation by Patrick McCarthy

Savannah area property owners might have a difficult time forgetting the last two years when Hurricane Matthew and Hurricane Irma wrought widespread damage throughout our area. According to the Colorado State University (CSU) Tropical Meteorology Project, 2018 looks to be no different. The Atlantic hurricane season is expected to have a “slightly above average” number of hurricanes and tropical storms. CSU is projecting 14 named storms will form during the June 1st – November 30th hurricane season. Six of those are expected to reach hurricane strength, and two are likely to be major hurricanes of category 3 or higher (winds from 111 to 130 mph).

For clients with property along the coast or within tier one areas, it is important to think ahead during hurricane season. Commercial real estate owners and homeowners need to have a thorough plan in place, including having the right insurance and making sure all repairs to the home or office are completed and able to withstand the weather.

Home and business owners should develop an evacuation plan and assemble any necessary supplies including food and water. A hurricane plan should be quick, simple and practiced. A reasonable timeframe is 48 hours or less before estimated landfall.

  • Time – There should be enough time to protect the property and allow for personal evacuation.
  • Supplies – Property owners should have all supplies needed to board up windows and doors on the property.
  • Checklists – A series of checklists to help facilitate implementation simplifies the process as no one usually has time for details when the storm is approaching.
  • Practice – “Practice makes perfect.” Practicing allows you to determine how much time is needed and how many people it will take to properly protect your property asset.

Property owners need to be aware of what is included in their insurance coverage. Business owners and homeowners cannot increase the amount of their insurance limits or add coverage to a single property after a hurricane watch or warning is in place.

The restrictions typically end within 48 hours of a watch or warning being lifted, but by then it may be too late to protect your investment or your property.

Purchasing property along the coast during hurricane season also comes with some warnings. To buy a home or commercial property along the coast, hurricane insurance must be in place at loan closing. Most of the insurance carriers place moratoriums on binding insurance for a period of time once an active storm watch or warning is in place. This restriction means some purchasers cannot get hurricane insurance once a hurricane watch or warning is in effect in the area surrounding the property. Not being prepared can also mean big losses. Not having insurance in place can mean losing escrow money or even the contract on the new property.

If there is earnest money in a transaction, the delay in getting coverage could cause the buyer to lose those funds. That loss could be thousands or millions of earnest dollars depending on the size of the transaction. Buyers cannot close on a residential or commercial real estate transaction if coverage is not in place. When buying coastal property, you should consider putting a caveat in the purchase/sale agreement that closing dates can be extended if a hurricane is approaching.

The old adage is true that “you can’t control the weather.” However, you can control how well prepared you are when the next storm approaches our region.

Patrick McCarthy is a Client Service Executive in Sterling Seacrest Partner’s property-casualty insurance practice. He can be reached at 912.988.5160 or pmccarthy@sspins.com.