“Should You File a Claim for Hail Damage? Key Considerations”

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Is Hail Damage a Covered Event?

Hail can cause significant damage to your roof, windows, and even lead to costly water damage. According to CoreLogic data, hail incidents reached new records in 2023, with hail 2 inches or more in diameter striking the U.S. 141 days of the year. Typically, homeowners insurance covers hail damage, but it’s essential to consider repair costs, potential impacts on your insurance premiums, and alternative payment methods before filing a claim.

Should You File a Claim for Hail Damage?

Standard homeowners insurance generally covers your home’s structure and personal possessions against hail damage, but there may be exceptions based on your location. In areas prone to severe windstorms, home insurance might not cover wind or hail damage. These high-risk regions often have state-run insurance programs offering separate wind and hail coverage. For instance, in Texas, wind and hail coverage can cost around $2,000 annually, but with the average hail claim costing $12,913, it might be worth the expense.

Remember, filing a home insurance claim involves a deductible, which is the amount subtracted from any claim payout. This could be a flat dollar amount or a percentage of your home’s dwelling coverage, typically ranging from 1% to 5%.

Does Homeowners Insurance Cover Rain and Wind Damage?

Hailstorms often come with rain, wind, or lightning, which are usually covered under homeowners insurance policies. Insurance generally pays to repair or replace your home’s structure, contents, and stand-alone structures if damaged by these elements. However, in high-risk regions, separate windstorm coverage might be necessary. While water damage from above (like rain or snow) is typically covered, water damage from below (such as burst pipes) may not be. For example, roof leaks after heavy rain are generally covered, but a flooded basement usually isn’t, requiring flood insurance.

Should You File a Claim for Hail Damage?

Filing a claim for hail damage could increase your premiums, and any deductible will be subtracted from your claim payout. Consider the cost of repairs, your deductible, and any recent claims history before deciding to file a claim. For instance, if hail damage costs $12,913 and you have a $1,000 deductible, insurance would pay $11,913, making it worthwhile to file a claim. However, with a 5% deductible on a home insured for $250,000, insurance would only pay $413, and you’d cover the remaining $12,500.

How Much Does Hail Damage Cost?

The cost of repairing hail damage varies based on the extent of the damage, your home’s size, and the materials used. Small repairs, like fixing gutters, can sometimes be done for under $200. Here are average costs for typical hail damage repairs:

• Roof repair: Average $4,250; can range from $300 to $32,500
• Full roof replacement: $5,890 to $12,700
• Concrete patio repair: $50 to $800
• Wooden deck repair: $860 to $3,400
• Storm window repair: $90 to $400 per window
• Mold remediation from water damage: $1,500 to $9,000

Tips for Paying for Hail Damage

If you’d rather not file an insurance claim, consider these other ways to pay for hail damage:

Emergency Fund

Using your emergency fund can help you avoid interest charges and potentially qualify for contractor discounts. After covering repairs, adjust your budget to replenish your emergency savings quickly.

Home Equity Loan

A home equity loan allows you to borrow against your home’s equity, receive a lump sum, and make fixed monthly payments. These loans usually have lower interest rates than credit cards but reduce your home equity and use your home as collateral.

Home Equity Line of Credit (HELOC)

Similar to a home equity loan, a HELOC uses your home’s equity as collateral for a line of credit. You can borrow up to your credit limit, repay, and borrow again until the draw period ends. However, failing to repay the loan could put your home at risk.

Credit Cards

With an average APR of 22.75%, using a credit card for hail repairs can be costly unless you can pay the balance in full. Consider an introductory 0% APR credit card to avoid interest charges, but keep credit utilization under 30% to protect your credit score.

Personal Loan

Personal loans usually have lower interest rates than credit cards and don’t require collateral. Interest rates can be fixed or variable, and loan terms range from six months to seven years. Although higher than HELOCs or home equity loans, personal loans don’t risk your home if you default.

Government Disaster Assistance

If your hail damage is part of a larger natural disaster, you may qualify for state or federal assistance. Visit the FEMA website for more information on disaster relief and contact your state’s emergency management agency for potential financial aid.

The Bottom Line

To protect your home from hail, consult your insurance agent and compare policies to ensure adequate coverage. Paying out of pocket for repairs might be more financially sensible than filing an insurance claim. Whether you’re shopping for insurance or exploring repair financing options, maintaining good credit can save you money. Check your credit score before applying for insurance, credit cards, or loans. Making on-time payments and reducing credit utilization can help improve your credit score, leading to lower insurance premiums and loan APRs.

For any mortgage service needs, call O1ne Mortgage at 213-732-3074. We’re here to help you with all your mortgage requirements.

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