Natural disasters are becoming more widespreadand severe. Did you know that 2020 and 2021 were the worst years on record for the most natural disasters?
The prevalence and intensity of storms,wildfires, floods, tornadoes and hurricanes not only threaten our safety, butcan also cause significant damage to our homes, and especially our vacationhomes. In fact, a recent analysis byRedfin real estate brokerage of housing records and ClimateCheck datauncovered that vacation homes are particularly vulnerable to natural disasters.Purchases of second homes with a high flood risk rose 45 percent between 2020and 2021, and purchases of second homes with high storm risk rose 40 percentduring that same period.
According to Redfin’s analysis, heat is the most commonrisk facing second-home buyers with high-storm risks coming in as a closesecond. Nearly 94 percent of second homes purchased in the past two years facea high heat risk while high storm risks affect 78 percent. These common risks are of course driven bypopular second-home destinations, such as Florida and Arizona, which both facehigh heat and/or storm risks.
As expected, average claims costs vary widelybased on the type of natural disaster. In 2021, 20 weather-related disasterstotaled more than $1 billion in damages each and $145billion in total combined damages overall, making it the third costliest yearin history for natural disasters. Similarly, 22 recorded billion-dollar weatherevents occurred in 2020. To date, Hurricane Katrina, which devastated theLouisiana, Mississippi and Alabama coasts back in 2005, is the most expensive natural disaster in U.S. history.
Unfortunately, the surge in costly climateevents combined with rising costs to rebuild, labor shortages and “demandsurges”' after natural disasters have triggered higher homeowners insurancepremiums, according to CNBC experts. However, withoutadequate homeowners insurance coverage, the costs of rebuilding and repairingdamaged homes would be extremely burdensome to the homeowner. For instance, ifa disaster hits and you have to rebuild or repair your home, you’re on the hookfor any amount that’s over your homeowners insurance limit. Do you have enoughhomeowner’s insurance coverage to cover increased construction costs?
Is your second home sufficiently covered?There’s no better time than the present to assess your risk and coverage onboth your primary and second homes. Licensed in 48 of the 50states, the personal linesdepartment at Kemmons Wilson Insurance Group insures families in Memphis with properties elsewhere as well asfamilies all over the country.
Contact anexpert at Kemmons Wilson Insurance Group to review and discuss your insurance coverage. Whether we’re protectingyour business, your employees or your loved ones, we provide you withpersonalized solutions to the problems you don’t see coming.