Connecticut Insurance Commissioner Thomas Leonardi told the Connecticut legislature’s Insurance and Real Estate Committee on Tuesday, November 15th, that the Connecticut Insurance Department (the “CID”) is currently considering options to revise requirements governing hurricane deductibles. Commissioner Leonardi reported that following Hurricane Irene, Connecticut residents filed 58,002 claims, and as of October 31st, 64 days after the hurricane, $161 million have been paid to policyholders.
The revised guidelines relate to the deductible homeowners would pay. Unlike standard deductibles, which are a set dollar amount, hurricane deductibles are based on a percentage of a home’s value. Previous regulations allow insurers to charge a hurricane deductible if a storm was downgraded to a weaker one up to 24 hours before it causes damage. In the case of the October storm, Hurricane Irene was downgraded to a tropical storm before it hit Connecticut. As a result, certain insurance companies have waived the hurricane deductible, while others have not. The CID is reviewing revised guidelines that will specify a storm must be classified as a hurricane when it hits the state.
Commissioner Leonardi hopes to have new guidelines on hurricane deductibles completed by the end of this year.