When Is a Home a Total Loss From a Hurricane?

Posted on September 25, 2023


Frances Badayos | author

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ICHQ | Site Author

Hurricanes are powerful storms that can do extensive damage. When a major or historic hurricane passes through, homes can be destroyed by the powerful winds. But, how is a home determined to be a total loss after a hurricane? What does a total loss entail?

If you have questions regarding what a total loss entails, the homeowners insurance claim attorneys at Insurance Claim HQ may be able to help. Their lawyers have extensive expertise in dealing with hurricane-related insurance claims and will be able to help you understand if you can potentially rebuild if your home is declared a total loss.

What Is a Total Loss of a Home?

A total loss may refer to one of two situations. The most common condition is when a home is in such a condition that the home is not able to be repaired without the repairs exceeding the actual value of the house. This is what is known as a constructive total loss. In the event of a constructive loss, the insurance company should pay you the full value of the home.

An actual total loss is more severe. It, too, is considered a total loss, but the home itself and the property in it have been destroyed. All that would be left in this situation would be debris. In this situation, you should be paid the full value of the property as well.

What Can You Do With Your Total Loss Payout?

Upon receiving your insurance payout, you can use it to purchase a new home or build a new home on your current lot. If your home is a partial loss, you may be able to rebuild the home and pay the difference. If you wish to rebuild your home after it was declared a constructive total loss, your payout would only cover the monetary value of your previous policy. Any additional funds required to rebuild your home would come out of your own pocket.

Your payout may be slightly less than the value of your policy if you have a deductible. With a deductible, you have to cover up to the deductible with your own money before relying on insurance money for repairs.

Can Insurance Companies Dispute a Total Loss Payout?

In certain cases, some insurance firms may dispute a payout. If your home is damaged in ways other than high winds and rain, some firms may deny coverage for perceived damage from other sources. Some firms may dispute your estimate of damage, and seek to rely on their own estimate, which may result in a lower payout. Finally, some firms may seek to defer and delay payment for an insurance payout, as can happen after a major hurricane.

What Is a Valued Policy?

In Louisiana, state law provides that, should a property be destroyed from multiple causes, the total value of the policy is to be paid, regardless of the cause or if it is covered. This law has been found to be valid in hurricanes, as well as due to other causes.

However, the Louisiana total loss statute requires that the value of the policy must be determined beforehand, at the time of the policy’s adoption, which may differ from the value of the property covered when the property is destroyed.

Contact Our Homeowners Insurance Claim Attorneys After a Destructive Hurricane

If you are a Louisiana homeowner and are uncertain about your total loss insurance payout, there is help available. The skilled lawyers of Insurance Claim HQ can work with you to help determine what your home is worth and work to defend your post-hurricane insurance claim. Contact us today by phone or online.