From Hurricane Matthew in 2016 to Florence in 2018 and Ian in 2022, South Carolina has experienced plenty of significant and damaging hurricanes, and the official return of the Atlantic hurricane season in June brought with it the potential for more storms this year. City and town officials looking to prepare for the next big one need to ask whether their insurance coverage is adequate — and the best way to do this is to maintain a list of assets needing insurance coverage, known as a property schedule.
Checking property schedules for accuracy each year can help prevent cities from discovering after a loss that the property had no coverage or had an incorrect value listed. Some common occurrences that can make a schedule outdated are the construction of new facilities or the purchase of assets that the city does not add to the schedule.
Reviewing coverage
- Understand how much money the coverage would pay if a storm destroyed a given building. Would the insurance cover it at its replacement cost or based on its actual cash value? Cash-value-basis coverage, which typically includes automobiles, factors in depreciation, which lowers the payout even when the cost of replacement does not decline.
- Know whether the coverage has a coinsurance provision, requiring the city to cover a certain percentage of the value of the building and its contents. If the city does not cover the property for the required minimum, it would have to pay a coinsurance penalty after a loss before the coverage would apply deductibles.
- Know whether buildings are located inside high-hazard flood zones. These are zones that the Federal Emergency Management Agency’s flood maps marks beginning with the letters “A” or “V.” The National Flood Insurance Program offers a maximum coverage of $500,000 for a building and $500,000 for contents. If a building is in a high-hazard area and is not insured to these amounts, then any claims payments may be a payout on top of the NFIP coverage. FEMA has a Flood Map Service Center online.
Preparing property
When a tropical cyclone is on the way, there are some steps that staff can take to reduce losses that go beyond the basics of securing anything likely to blow away. For example, for structures known to be in low-lying areas vulnerable to flooding, staff can move their contents to higher ground. They can also move all vehicles and equipment out of low-lying areas, and spread the equipment among multiple locations in case a catastrophic loss occurs at any one location.
For offices in locations known to be vulnerable, workers may want to move all important paperwork, computers and any other equipment to another location, or potentially cover equipment under plastic sheets and move it away from windows and off the floor.
Managing property after a loss
When a loss happens, the city’s first steps should be to secure damaged property to prevent any further losses — for example securing leaking roofs with plastic or tarps. Employees should also immediately document the losses through photographs and written descriptions for the insurance claims.
The SC Emergency Management Division maintains a detailed South Carolina Hurricane Guide explaining hurricane basics, preparations and evacuation processes.