Hurricane insurance in coastal Florida is commonly written with which type of deductible?

• A. Percentage
• B. Straight-dollar
• C. Franchise
• D. Named-Peril

Answer: (A)

In coastal Florida, the hurricane deductible is typically expressed as a percentage of the amount of dwelling coverage. This works well because rebuild costs and home values can swing a lot over time; a percentage keeps the deductible proportionate to the size of the home, so the amount you pay after a hurricane loss scales with the potential loss. It also helps insurers price the risk more fairly and prevents a fixed dollar amount from becoming either too small to matter on valuable homes or unrealistically large on smaller ones. The deductible is specifically tied to hurricane or windstorm losses, not to all perils, and it’s distinct from a fixed straight-dollar deductible or any franchise-type structure. Named-peril describes what risks are covered, not how the deductible is calculated, so it’s not the deductible type used here.