In the wake of Hurricane Ida, which destroyed hundreds of thousands of cars, drivers likely turned to their auto insurers for help.
But minimally insured drivers might be surprised to find their state’s required coverage doesn’t pay for damage from floods and other natural disasters. Only 78% of insured drivers are sufficiently covered in case of a natural disaster, according to the Insurance Information Institute’s analysis of 2018 data from the National Association of Insurance Commissioners, the most recent data available.
Here’s how auto insurance works after a natural disaster and what you should do in case the worst happens.
Comprehensive coverage pays for damage from natural disasters
Comprehensive coverage pays for damage from natural disasters, including floods, hail, tornadoes and wildfires, plus other causes that don’t involve a collision with another vehicle.
It covers up to the current market value of your car, minus your comprehensive deductible. If your car is considered a total loss — meaning the cost to repair it is close to or higher than its value — your insurer will issue a payment for your car’s current retail value minus the deductible.
This coverage is typically optional unless you drive a leased car or have an auto loan. If your current policy doesn’t include comprehensive coverage and you’d be unable to cover the cost to repair or replace your car after a natural disaster, you may want to add it. It’s probably not necessary if you drive an older car, as the coverage won’t pay out much in a claim, if anything at all.
While you can add comprehensive coverage at any time, it won’t pay out retroactively. You’ll need it on your policy before your car is damaged for it to take effect.
File comprehensive claims as quickly as possible
Insurance companies and repair shops may get bogged down in claims after a natural disaster, so file a comprehensive claim as quickly as you can. “The sooner your claim comes in, the sooner you are in line for assistance,” says Jessica Castillo, senior claims manager at Metromile.
To speed up the claims process, Castillo suggests providing photos of your car before the damage, if you have them. Many companies let customers file claims online or through a mobile app, which can help customers avoid busy phone lines.
If you’re unable to cover the cost of your deductible, Castillo recommends you still have your car looked at by a mechanic, even if you wait to file a claim. You’ll learn what the repair estimate is, plus you’ll find out if your car can be safely driven while you save up for the deductible.
Take extra steps if you don’t file a claim immediately. Castillo advises noting the date of the event and how it happened, plus taking photos of the damage. You should also look for ways to prevent more damage, such as drying out your car after a flood to avoid mold.
Consider other coverage options
Other coverage options can offer financial peace of mind, according to Dave Powell, vice president of auto claims for Travelers Insurance.
Rental reimbursement coverage will cover the cost of a rental car or public transit if your car is being repaired for a covered claim. “How are you going to arrange for alternative transportation and how are you going to pay for it” while your car is in the shop, Powell asks. If you’re unsure, this may be a worthwhile addition to your policy.
If your new car is totaled, new car replacement coverage will pay for a new car of the same make and model, minus your deductible. Depending on the insurer, the coverage will pay out for totaled cars 1 to 5 years old.
Take precautions and mitigate further damage
The safety of you and your loved ones should be the top priority in a crisis. But if you’re given enough notice of a coming storm, these tips can help lower the risk of car damage:
- In the event of a flood warning, move your car to higher ground, like the top of a hill or a high level in a parking garage.
- Park your car in a garage or other shelter to avoid damage from hail or wind.
- Use sandbags or flood barriers in your garage to prevent water from getting inside.
- Avoid parking under trees or power lines.
- If you own multiple cars and need to evacuate, try to get all vehicles out of the disaster area.
- Don’t drive through standing water.
After the storm has passed, check the damage to your car. If it’s flooded, don’t start it. Instead, disconnect the battery, roll down the windows if possible and get the car towed to dry ground.
Also, check for cracks in the windshield or windows, and cover any you find with a tarp to avoid further damage to your car’s interior.
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Ben Moore writes for NerdWallet. Email: firstname.lastname@example.org.