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Deductible Buybacks for Coastal Properties

Recent catastrophic losses around the country, as result of Hurricanes Harvey, Irma and Maria, coupled with the threat of severe weather continuing to impact coastal communities, further underscore the need for insurance agents to offer alternatives to their coastal clients. Over the years, on the heels of a cat loss, policyholders, many with high property values, face overwhelming financial burden in their deductible layers. Higher premiums and high deductibles for wind or flood damage have increased their financial burden when a loss occurs.

Wilmington Insurance Agency specializes in working with agents to provide property solutions to coastal residents. One of our solutions includes offering insureds deductible buyback insurance (DBB) to help them reduce their financial risk in the event of a loss by lowering their wind or flood deductible with a separate policy.

How A Deductible Buyback Works

A wind buy-back policy can provide an additional layer of protection in areas where requirements for insurance deductibles have become exceedingly high. It exclusively covers wind damage and serves to help satisfy a homeowner’s deductible, which must first be exhausted before the homeowners coverage applies. An insured whose property sustains wind damage from a hurricane must first pay their deductible, after which the wind buy-back policy applies, and then their regular homeowners’ policy. Let’s say your client has a 5% wind deductible on a $500,000 property. The client will have to pay the first $25,000 worth of damage. The client can choose to reduce his or her wind deductible. Under a wind buy-back policy, the insured, under a separate policy, could cover all or a portion of their deductible.

We also offer a DBB program for flood insurance.

We’ll Help You Navigate the Coastal Property Market

Our products are exclusively distributed through independent insurance agencies and we look forward to expanding your book of business in the coastal insurance market. For more information about our products, please contact us at 302.231.2800.