Florida Office of Insurance Regulation Reminds Insurers on Deductible Applicable to Tropical Storm/Hurricane Hermine Claims

The Florida Office of Insurance Regulation issued Informational Bulletin OIR-16-07M on October 3, 2016 reminding residential property insurers in the State of Florida that Tropical Storm/Hurricane Hermine was not declared a hurricane by the National Hurricane Center of the National Weather Service until Thursday, September 1, 2016, at 1:55 P.M. CDT. 

Before Thursday, September 1, 2016, at 1:55 P.M. CDT, Tropical Storm/Hurricane Hermine was classified as a Tropical Storm. 

Section 627.4025(2)(a), Florida Statutes, specifically defines “hurricane coverage” as coverage for loss or damage caused by the peril of windstorm during a hurricane. Furthermore, (2)(b) provides “Windstorm” for purposes of paragraph (a) means wind, wind gusts, hail, rain, tornadoes, or cyclones caused by or resulting from a hurricane which results in direct physical loss or damage to property and 2(c) defines “Hurricane” for the purposes of paragraphs (a) and (b) as a storm system that has been declared to be a hurricane by the National Hurricane Center of the National Weather Service. 

Informational Memorandum OIR-16-07M thus notifies insurers that hurricane deductibles shall not apply to property losses associated with a Hurricane Hermine damage claim that occurred prior to Thursday, September 1, 2016, at 1:55 P.M. CDT nor after Monday, September 5, 2016, at 5:00 A.M. EDT, which is 72 hours following the last hurricane watch or warning issued for Hermine by the National Hurricane Center. 

For these property losses, all insurers must apply the deductible that is unrelated to hurricane, generally referred to as the “all other perils deductible” or “other than hurricane deductible.” 

An insurer that fails to apply the appropriate deductible is subject to administrative action.

To read the complete Bulletin, click here.