Tornado Damage: What Home and Car Insurance Coverage You Need

How to Avoid Being Stuck Paying Out of Pocket After a Tornado or Windstorm

what insurance protects you from a tornado on the horizon
How to get the best tornado and strom coverage from insurance. john finney photography / Moment / Getty Images

If you are worried about damage and claims arising from tornadoes and spring storm conditions like hail, rain or windstorms, most standard home and car insurance have basic provisions for tornadoes (which are windstorms) and various weather related types of risks. But the type of coverage you have can make a difference of thousands of dollars in how much you get paid in a claim.

Many homeowners and renters can find themselves in a very bad situation if they haven't checked their insurance coverage carefully.​

Why You Need to Prepare 

Tornadoes can appear from any direction and may or may not be accompanied by hail, lightning, thunder, and rain. The most dangerous aspect of the tornado is its force and sudden appearance, destroying property with little warning. Because of this, being prepared, not only for the safety of your family but in the type of insurance you have will make a significant difference on how you come out from these kinds of storms and dramatic weather.

Tornado and Severe Spring Weather Insurance Checklist

This is a basic checklist of things you can do in advance to prepare yourself so you can prevent damage, and increase safety in the event of a tornado. The idea is to prevent injury and damage on or to your property, as well as to ensure that if you have to make a claim that you get the best possible settlement.

The Biggest Risk in Your Home Insurance Coverage for Tornadoes

The biggest risk you may face if your home suffers major damage during a severe storm or tornado is being underinsured.

With changing costs of construction materials and labor, home insurance reconstruction costs have increased over the years. Although some policies do include the option for inflation adjustment, this is not sufficient to cover varying reconstruction costs. Take some time to verify the value your home is insured for.

Then, be sure to inquire about what happens in a claim if your home is underinsured.

Some policies include guaranteed replacement cost, however, the limit may be capped.

Other policies may limit you to the insured value. With so many homeowners underinsured, this is a major problem that may leave you in a situation where even with insurance, you won't have enough to rebuild!

This is one aspect of your insurance you don't want to leave unchecked. Contact your agent or broker to discuss your policy and if necessary have them verify that the current insured value is up to par. Ensure you have all the best insurance endorsements available to you to guarantee you are fully covered in a major loss.

Getting the Best Insurance Protection: How Will Tornado Damage Be Paid in a Claim

Although damage from hail, windstorms and other types of spring damage are covered, the information you need to know extends beyond whether it is covered to how it is covered.

The answers to the following questions will make a significant difference for you when you make a claim. Start with a conversation with your insurance agent or representative to make sure you understand the claims process fully before you have to make a claim.

  • Find out what kind of home insurance policy you have. You want to make sure you have an All Risk or Open Perils policy to ensure the maximum protection for your home and personal property.
  • Find out if you have a specific deductible in the event of a tornado or windstorm, and make sure that you have enough money set aside to cover that deductible. Higher risk areas may impose higher deductibles.
  • This is possibly the most significant aspect of the policy that few people pay attention to before a claim: Find out what the basis of claims payment will be. This is very important and can make a difference of thousands of dollars in how much you will get in a claim. Do you have Replacement Cost, Actual Cash Value (ACV) or a Replacement Value with Cash Out Option? Cash Out options are less common and only available for high-end insurance policies.

TIP: If making an inventory seems overwhelming, take video while you walk around your property or take photos and store these in a safe place, ideally with copies off-site or in the possession of someone you can trust

  • Find out what kind of coverage you might have if there is a power failure
  • Make sure that your policy does not exclude or limit windstorm damage. Ask your insurance representative to review this with you. Never assume you have standard coverage, every state and region is different and based on local claims experiences and risks, certain types of policies may exclude coverage that would otherwise be included elsewhere. Always ask about your policy exclusions and make sure to inquire if there is any way to add coverage if needed.

No House? You Will Still Have to Pay Your Mortgage 

  • Find out what your limit is for Additional Living Expenses (ALE) and how you can expect the coverage to work. During a devastating loss, like damage to your home from a major windstorm or tornado, you may not be able to live in your home while repairs are done in the area, or to your property. This coverage will be vital in major losses. Homeowners who have a mortgage will still be expected to pay that loan back while the home is being rebuilt. Additional living expenses cover the increased cost of living due to the displacement, and this includes that extra rent you will have to pay for your temporary home or the higher costs of food if you have to eat out because you don't have a kitchen to make your meals in for a while.

The Coverage You Need to Ask About On Your Car Insurance

  • Make sure your car insurance includes comprehensive coverage if you want to be covered against the dangers that may damage them during a storm, such as falling objects, hail or windstorms.
  • Ask if you have coverage for a rental car if your car has hail damage, or is smashed by a falling or flying object and needs to get repairs. Cars are at risk to all kinds of damage in storms. It's nice to have insurance coverage that replaces or repairs the vehicle, but the time you spend without a car while you wait to get your vehicle back can be devastating. If you need your car during that time, it could cost you a lot of money to rent one. Coverage for a rental loaner, while your car is repaired, is not expensive to add to your policy.
  • If your car is in "storage" make sure you haven't forgotten about coverage (or the fact that you deleted covered) while it's in storage. Liability coverage will not protect your car from physical damage that often occurs during storms and tornados.

Tornado and Sudden Storm Damage Prevention Checklist

Here are some preventative steps to prepare your property and your family for severe weather risks:

  • Secure any items that are not attached to the property. Like garden furniture, hanging plants, or other items that might be blown over or fly away. These items may not only get damaged but may also fly off your property and hurt someone or damage other people's property. Your homeowner insurance policy does include personal liability coverage that may respond in circumstances like this, but it is better to take precautions and avoid these situations by preparing in advance
  • Maintain landscaping and trees on your property to avoid branches and trees from falling on buildings or additional structures, fences, cars, walkways or powerlines
  • Secure any flammable liquids or materials in safe places
  • Store important documents and valuables in a safe place
  • Prepare your family by making a safety plan and make sure you have a supply of emergency food, water, and a first-aid kit. Don't forget to include a plan to keep your family pets safe in the process.
  • Keep a battery operated radio available to allow you to listen to weather warnings and news about what is happening in your area
  • Prepare flashlights and batteries
  • Install a carbon monoxide detector in your home
  • Put your car in a garage or covered area to avoid things flying into it or on top of it

Property Damage After a Storm and Making a Claim

Immediately following a major storm or a tornado, you will want to inspect your property, make sure and follow safety guidelines of what to do after a major storm or tornado. If you think that there has been damage, you will want to call your insurance company right away. Very often, in catastrophic losses the insurance companies will send out emergency response teams. Insurance companies are specialists in handling disasters, reach out to them for help.

Once an adjuster is assigned, they will come and assess the damage to your property. You will be asked for a lost items list which will be used to complete the proof of loss. The inventory you made or any photos or videos you have taken before the loss will help you compile a list of what you have lost. When you have a claim, it is very stressful, and it becomes difficult to remember everything right away.
This is where preparing in advance will help you recover the most from your loss.

Your insurance adjuster will be able to help you understand the steps in the claim, as well as what may or may not be covered. If you've asked all the right questions before a major claim and took the right home insurance for your lifestyle and needs, your preparation will pay off because you will be in the best position to get the most money for your loss and damages, and will avoid surprises. The stress and uncertainty when a devastating claim happens are bad enough. Go through these checklists before the damage to avoid getting stuck paying out of your pocket. It definitely pays to have some peace of mind knowing you choose the right coverage as well as knowing what your obligations would be after a loss. Have the conversation with your representative about your insurance coverages today, so you can rest easy if stormy weather heads your way.