Natural disasters

Who’s at risk?

Research from the Substance Abuse and Mental Health Services Administration (SAMHSA) shows that lower-income individuals are most at risk from natural disasters. Although they receive disaster warnings, they can often not react or have the emergency funds to prepare in advance. SAMHSA considers lower-income individuals as those with lower incomes, public housing residents, and homeless or unemployed individuals.

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“The elderly, disabled, and homeless are the ones more vulnerable during a natural disaster,” says Lindsey Maxwell. As the co-founder of her blog Where You Make It, she has converted two vans and traveled the U.S. extensively. 

It’s also true that some locations may pose a greater risk to its residents than others.

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Types of disasters by state

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Florida may be known for its hurricanes, but according to the Insurance Information Institute (III), these are the top five costliest states based upon their cumulative reported insured losses. 

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Costliest states by insured catastrophe losses, 2019

StateType of natural disasters

Estimated insured loss (millions)

Number of claims

Texas

Hurricanes, hailstorms, tornadoes, flood, fire, extreme heat and cold$7,236.4583,050

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Illinois

Severe storms, flood, tornadoes, snow$1,707.2168,100

Colorado

Hailstorms, fire, flood, droughts, blizzards$1,366.9127,450

OhioSevere storms, flood, tornado, snow$1,345.1106,950

CaliforniaWildfires, earthquakes, flood, severe storms$1,321.771,450

What is usually covered by insurance?Having insurance coverage can help in the face of a disaster with replacing lost items and giving you a place to stay while your home is being repaired. The III breaks down the basic coverage types that typically come with the standard homeowners or renters insurance policy. Below, highlights the property coverage that typically applies in the event of a natural disaster.

Insurance coverage by property policy type

Dwelling & personal property

Hazard typeBasic HO-1Broad HO-2

Fire or lightning✔✔

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Windstorm or hail✔✔

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Explosion✔✔

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Smoke✔✔

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Volcanic eruption✔✔

Falling object✔

Weight of ice, snow or sleet✔

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Dwelling

Hazard type Special HO-3

Fire or lightning✔

Windstorm or hail✔

Explosion✔

Smoke✔

Volcanic eruption✔

Falling object✔

Weight of ice, snow or sleet✔

Personal property

Hazard typeSpecial HO-3Renters HO-4Condo/Co-op HO-6

Fire or lightning✔✔✔

Windstorm or hail✔✔✔

Explosion✔✔✔

Smoke✔✔✔

Volcanic eruption✔✔✔

Falling object✔✔✔

Weight of ice, snow or sleet✔✔✔

Dwelling & personal property

Hazard typeModified coverage HO-8

Fire or lightning✔

Windstorm or hail✔

Explosion✔

Smoke✔

Volcanic eruption✔

Falling object

Weight of ice, snow or sleet

What is not covered by insurance?

While property insurance should cover most natural disaster claims, certain catastrophic events would be excluded from your standard property coverage. Without the proper coverage for these events, it could leave you in a serious bind. 

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• Floods: flood insurance usually requires separate insurance coverage that can be purchased from the National Flood Insurance Program (NFIP).  

• Earthquakes: earthquake insurance is usually an add-on coverage that you purchase for your policy. In California, the California Earthquake Authority (CEA) is a useful resource. 

• Maintenance damage: mold and termite infestation is considered a failure to maintain your home, so it may not be covered unless you purchase extra protection.  

• Sewer backup: sewer backup requires additional insurance coverage as it is not commonly included in the standard homeowners, renters or flood process.

Be prepared

When you live in a high-risk area, the best thing you can do is be prepared, says Robert Stam. Today, he is the CEO of SEO Mandarin and caught the travel bug in his earlier years. “I spent several years traveling, living in and working out of my vehicle,” he explains. 

“What living out of a car teaches is that with proper preparation, we can survive, even thrive, with the bare minimum,” he says. “While it may not be a sustainable long-term arrangement for many people, equipping a car with a basic camping kit can provide shelter and sustenance from even the most basic of vehicles.”

Emergency bag

When Maxwell was traversing the country, her emergency kit was an invaluable partner on her travels. It is something she stresses the importance of now. “It’s crucial before a natural disaster hits your local area to create your own portable disaster kit.  It would be best if you grabbed essential supplies you will need, such as important documents.”

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