Hurricane Douglas Poses Threat to Hawaii

Hawaiians generally buy hurricane coverage separate from homeowners policy

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NEW YORK, July 24, 2020—Hurricane Douglas is headed toward Hawaii and the storm's strong winds and heavy rains have the potential to cause property damage statewide later this weekend, according to the Insurance Information Institute (Triple-I).

“The National Hurricane Center is currently forecasting Douglas to be at hurricane strength when it approaches Hawaii this weekend. While it will likely weaken somewhat from its current intensity by the time that it gets there, Hurricane Douglas could still cause significant impacts on Hawaii,” said Dr. Phil Klotzbach, a Triple-I Non-Resident Scholar who also leads the Tropical Meteorology Project in the Department of Atmospheric Science at Colorado State University (CSU).

Hawaii homeowners and renters insurance policies usually provide coverage for almost all standard perils (e.g., fire, explosion) and liability; however, some policies exclude hurricanes.

In Hawaii, homeowners and renters generally purchase hurricane and flood insurance policies separately to protect their property from those specific natural disasters, and to supplement their homeowners and renters insurance policies.

“In addition to encouraging consumers to buy the appropriate coverage, the Triple-I has been outspoken about the need to bridge the flood insurance coverage gap and build more resilient communities through its Resilience Accelerator,” said Sean Kevelighan, CEO, Insurance Information Institute. “In fact, the average take-up rate for flood insurance in the entire state of Hawaii is 12.6 percent, which is an alarming recovery gap for citizens.”

Most of Hawaii's hurricane insurance policies have a "72-hour clause," which means that once a hurricane watch or warning is issued by island, by the National Weather Service, damage sustained through the 72-hour period following the cancellation of the watch or warning for the island will be covered under a hurricane policy, according to Hawaii Insurers Council.

Only a flood insurance policy, available through FEMA’s National Flood Insurance Program (NFIP) and some private insurers, can protect a homeowner, renter, or business from flood-caused property damage. Most U.S. natural disasters involve flooding, and standard homeowners, renters, and business policies do not cover flood-caused damage.

An auto insurance policy's optional comprehensive provision covers wind, hurricane and flood-caused property damage to vehicles. About four out of five U.S. drivers opt to purchase comprehensive coverage.

Business insurance policies, which offer coverage for property damage, may also come into play, according to the Triple-I.

Iniki was the costliest hurricane in the state’s history, causing $1.6 billion in insured losses when it struck Hawaii in 1992. The $1.6 billion figure is equal to nearly $3 billion in today’s dollars.

FACTS & STATISTICS:

Hurricanes

Hawaii Hurricane Fact File

ISSUES UPDATES:

Catastrophes: Insurance Issues

Flood Insurance

Hurricane and Windstorm Deductibles

Create a Home Inventory

The Triple-I has a full library of educational videos on its YouTube Channel. Information about Triple-I mobile apps can be found here.

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