Does insurance cover tornado damage?
Insurance covers tornado damage to your home, personal property and your car in most cases. What type of insurance covers damage from a tornado depends on the type of damage. You need the right coverage, especially for your car, which isn't protected if you carry liability-only insurance.
How does home insurance cover tornado damage?
A standard home insurance policy does cover damage caused by a hurricane. However, having the right amount of coverage for your home is key.
"People go through a devastating experience and find they don't have enough coverage to rebuild," says Melissa Digby, former national loss prevention director for USAA and now the company's Strategic Change Principal.
In fact, nearly two out of every three homes in America are underinsured. The average underinsurance amount is about 22%, though some homes are underinsured by 60% or more, according to Nationwide.
Here's how home insurance coverage works after a hurricane:
- Dwelling coverage. This covers your home and any structures attached to it for its replacement cost, which is calculated based on what your insurance company knows about your house.
- Other structures. Usually set at 10% of your dwelling coverage, this covers any structure on the property not attached to the house, like a shed.
- Personal property. Also set at a percentage of the dwelling coverage, usually 50-70%, this covers your belongings. That means everything in the house that can be removed, from table linens to computers.
- Additional living expenses (ALE). Also called loss-of-use, this coverage will pay for you to live elsewhere if a tornado renders your house uninhabitable during repairs or rebuilding.
Standard home insurance policies cover your home for replacement cost, which means no depreciation is included. However, replacement cost changes over time, especially if you've made improvements to your home. Make sure you notify your insurer of any remodeling or additions, and look into purchasing extended replacement cost coverage.
Extended replacement cost coverage provides extra dwelling coverage beyond the amount listed on the policy, usually 25% more, but sometimes 50%. Some companies also offer a guaranteed replacement cost endorsement that ensures the house will be rebuilt no matter how much the cost goes over the limit.
You should also make sure your policy provides replacement cost coverage for personal property; standard home policies offer this coverage at actual cash value (depreciated) prices.
Do wind and hail exclusions apply to tornadoes?
Home insurance policies usually cover roof damage caused by fire, vandalism, and “acts of God,” such as hurricanes and tornadoes. However, in some states prone to storms with high winds, such as tornadoes, coverage may be limited if your insurance company and state laws allow hail and wind exclusion.
These exclusions mean insurance companies don't have to pay for cosmetic damages, just structural damage. If your carrier has such an exclusion in your policy, it can exclude payments for damage to exterior surfaces, including walls, roofs, doors, and windows from hail or wind if the storm impacts the appearance but not the function of these elements.
You may need to purchase a separate policy or add an endorsement to your policy, and a separate windstorm deductible might apply.
Does renters insurance cover tornado damage?
Your landlord's policy will cover the house or apartment itself if a tornado damages it, but that policy doesn't cover anything you own.
Renters insurance covers your personal property for tornado damage, and, like a home insurance policy, it includes loss of use coverage to help pay expenses if you have to live elsewhere during repairs. Like home insurance, renters may not automatically include replacement cost coverage, so be sure to add it.
Does car insurance cover tornado damage?
If your car is damaged by a tornado, your car insurance will cover it as long as you have comprehensive coverage on your policy. Part of what's known as full coverage, comprehensive pays for damage to your car caused by things other than a collision, like weather damage.
You'll have to pay your deductible, but after that, your car insurance company will pay for your car's actual cash value.
How much does tornado insurance cost?
There's no specific cost to tornado insurance. It's included in your home and car insurance policies (as long as you carry full coverage) and doesn't add any cost.
The only exception is if your state allows wind and hail exclusions, in which case you may need to purchase a separate policy or an endorsement. That will have an additional cost, but you'll need to get quotes specific to your home to find how much.
What state has the most tornadoes?
In 2022, the NOAA reported that the top 10 states for tornadoes were:
- Mississippi
- Texas
- Alabama
- Minnesota
- Florida
- Kansas
- Louisiana
- Arkansas
- Georgia
- Iowa
- Colorado
If you live in a high-risk area, ensure you have the right coverage; speak with your insurance agent or representative to find out if you're properly protected.
However, since a tornado can happen just about anywhere, it's important that everyone check their insurance coverage.
Tips to prepare for a tornado
The CDC recommends the following steps to prepare for a tornado:
- Pay attention to thunderstorm watches and warnings as they may escalate.
- Be aware of whether there's a tornado watch or warning: a warning means a tornado has been sighted.
- Know how your area warns about tornadoes, including what it means when you hear sirens.
- Know where the safest place is to shelter during a tornado: plan this ahead and remember that a mobile home is not safe during a tornado.
- Create a tornado plan and practice it.
- Make a plan for anyone with special needs or prescription medication.
- Have important information and documents stored in one place and ready to go in case you need to leave suddenly.
- Have an emergency supply kit ready that includes food, water, a source of heat and light, medications and anything else you might need in case help can't reach you quickly.
- Make sure your home is secure, including the structure, bolting furniture to walls and knowing how to turn off utilities in case something is damaged.
Sources
National Centers for Environmental Information. "U.S. Tornadoes." Accessed May 2024
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