Disaster Insurance in Pennsylvania

In Pennsylvania, natural disaster insurance or catastrophe insurance protects residents and businesses from damages/losses resulting from certain catastrophic weather perils. It financially protects an insured/policyholder from those perils that standard residential or commercial property insurance excludes, such as floods and earthquakes.

Pennsylvania is considered one of the least vulnerable states to natural disasters in the U.S. However, it still offers various property insurance coverage for homeowners, renters, and commercial property owners in the event of unexpected weather events. The Pennsylvania Emergency Management Agency (PEMA) aids residents and communities in mitigating the devastating effects of catastrophic weather events through early preparation and using advanced detection and warning systems. Typical weather data for this purpose include temperature, wind speed, atmospheric pressure, and precipitation.

Note that natural disaster insurance is not a single comprehensive coverage for all types of weather disasters or perils. It is, instead, a selection of separate insurance policies that serve as supplemental coverage for different catastrophic weather events. Earthquake insurance, for instance, can protect the insured against residential and commercial property damage or loss due to earthquakes. Similarly, a more common weather peril in Pennsylvania, flood insurance, offers coverage for flood-related damages or losses. The Pennsylvania Insurance Department regulates insurance carriers, including natural disaster insurers in the state.

What is Disaster Insurance?

In Pennsylvania, disaster insurance refers to any insurance coverage that protects residential and commercial properties from damage by catastrophic weather perils such as large hail, wildfire, tropical storms, floods, and earthquakes. Getting disaster insurance in Pennsylvania is important because of the ongoing climate changes and the increasing rate of real estate development in disaster-prone regions in the state.

Do Disasters Need Insurance Coverage?

Yes, all disasters need the appropriate insurance coverage. Natural disasters in Pennsylvania, such as tropical storms and wildfires, frequently cause damages and/or losses that exceed typical out-of-pocket limits/reserves. Generally, regular property and casualty insurance policies, such as homeowners, renters, and commercial property insurance, cover property repair or replacement costs resulting from theft, vandalism, and other common perils. They usually do not cover damage caused by extreme natural disasters such as earthquakes and floods, which mostly result in widespread destruction and, sometimes, loss of lives. For example, in September 2011, Tropical Storm Lee resulted in a massive flood that damaged 16,000 buildings and destroyed 1,000 homes and businesses. It also led to seven deaths and property damage worth over $2 billion. More recently, in 2021, natural disasters resulted in 10 deaths and caused the Commonwealth of Pennsylvania nearly $400 million in property damage.

Real Estate

While 69% of Pennsylvanians represent homeowners, renters account for 31% of the state’s housing units.

Some Pennsylvania communities, such as Harrisburg County and other counties flanking the Susquehanna, Allegheny, Delaware, and other major rivers, are more susceptible to flooding. Persons residing or doing business in such high-risk locations need to supplement their regular property insurance policies with flood insurance and other requisite disaster insurance policy for additional protection. Generally, banks that issue mortgages for homes and loans for businesses require flood insurance as a precondition for releasing the funds.

Vehicles

With over 12 million vehicles registered in the Commonwealth, to protect them from non-collision damage, such as flooding or a tree falling down from the tornado winds, the owner of the vehicle needs to consider comprehensive auto insurance. Even if a car gets flooded while inside the garage of a property with an active flood insurance coverage - there is still no coverage for the vehicle. The garage itself and your personal property inside the car will be covered by flood and homeowners or commercial property insurance. Meanwhile, comprehensive auto is the only policy that will protect your car in the event of damage from a natural disaster.

Disaster insurance coverage is recommended for every Pennsylvanian residential or commercial property owner, regardless of whether they reside or do business in high-risk locations or not. However, you are responsible for determining what specific additional disaster coverage you require and how much is adequate. A licensed Pennsylvania P&C insurance agent can help you find the most appropriate selection of coverages based on your needs, budget, and the prevalent risks in your location.

What Types of Natural Disasters are Common in Pennsylvania?

In Pennsylvania, you can get insurance coverage for these common natural disasters:

• Floods: The most common natural disaster in Pennsylvania is flooding. Flash floods and storm-related floods cause significant property damage to homeowners, renters, and business property owners in the Commonwealth. Even Pennsylvanians residing in locations not prone to flood events are still vulnerable to this peril. Flood insurance protects an insured’s property and belongings against flood-related damages and is mandatory for persons living in floodplains or Special Flood Hazard Areas (SFHAs)

• Fires: Fire perils, especially wildfires, are generally regarded as another major cause of property damage/destruction in Pennsylvania. Fire is usually covered under a standard residential or business insurance policy. Pennsylvania’s State-funded insurance program, the FAIR Plan, also ensures that basic fire insurance is available to those who were not able to get the coverage through the standard insurers

• Winter storms: In Pennsylvania, winter storms are extreme weather events that are usually characterized by one or more of these precipitations: heavy snow, sleet, or freezing rain. They are prevalent between December and February and can occur as blizzards, ice/lake effects or storms, or storm squalls. In the event of a damage caused by a winter storm, standard residential and commercial property insurance pays for repairs or replacements subject to the policy limits

• Earthquakes and landslides: These dangerous earth movement events can cause extensive damage to life and property in Pennsylvania. They are not covered under regular property insurance but can be purchased as endorsements or separate policies. Earthquakes are, however, not a common disaster in the Commonwealth of Pennsylvania

• Tropical storms, tornadoes, and hurricanes: Although none of Pennsylvania’s coastlines lie along the Atlantic Ocean, tropical storms and hurricanes still regularly wreak havoc within the Commonwealth. Strong winds and heavy raindrops radiate hundreds of miles from the center or eye of a tropical storm or hurricane to make their destructive impact felt inland. With less than 65 miles to the ocean, Pennsylvania is still exposed to the whims of nature

• Thunderstorms and hailstorms: Thunderstorms are regular weather events in the Keystone State, especially in east Pennsylvania. They often cause hail swaths of varying hail size , lightning-induced fires, and flash floods. Damages/losses from thunderstorms and hailstorms are covered under regular residential and business property insurance. The National Oceanic and Atmospheric Administration (NOAA) and the National Hurricane Center (NHC) help protect vulnerable Pennsylvanians by issuing regular weather forecasts, watches, warnings, and to detect hail

What Types of Disasters are Insurable in Pennsylvania?

In Pennsylvania, all types of natural disasters are insurable, and they include:

• Floods: Floods rank highest on Pennsylvania’s natural disaster list and account for the severest damage to residential, rental, and commercial properties

• Fires: Whether resulting from man-made or natural causes, fire-related damages are nearly as extensive and costly as those caused by flood events in the Commonwealth and are insurable

• Sinkholes: Pennsylvania’s underground karst (limestone/dolomite) structure exposes property owners in vulnerable regions of the Commonwealth to sinkhole-related damages/losses. Sinkholes are, however, insurable

• Winter Storms: Extreme winter weather is common in the Commonwealth of Pennsylvania. Different types of snowstorms regularly deposit copious amounts of snow on homes and commercial properties, resulting in significant damage. Land and air traffic disruptions, power outages, and multiple auto accidents can also frequently happen during snowstorms. However, storms are insurable

• Tropical Storms, Tornadoes, and Hurricanes: In Pennsylvania, tornadoes are not as common as fire or flooding hazards and were previously prevalent in the western part of the Commonwealth. They are, however, just as devastating and can lead to fatalities and property damage to homes and businesses. Remnants of hurricanes from the Atlantic Ocean also lead to significant property damage when they reach inland and bring in heavy rains, typically lasting for several days

• Hail: Hailstones are water generated by being refrozen in the atmosphere. Pennsylvania is home to all sizes of hail, from smaller hailstones of 1-2mm in diameter, to the larger ones, the size of a baseball or bigger. Hail typically falls with the speed of 25-40 mph, but the largest ones can accelerate to the speed of up 100 mph.

What Type of Disasters are Not Insurable in Pennsylvania?

All types of disasters are insurable in the Commonwealth of Pennsylvania. However, some are not covered by a standard residential or property insurance policy. Typical examples of excluded perils include tsunamis and earthquakes, which require add-on coverages or separate insurance policies.

What are the Types of Disaster Insurance in Pennsylvania?

In Pennsylvania, different disaster insurance types protect from widespread damages/losses to homeowners, renters, and business properties:

Flood Insurance

Flood insurance, a type of property insurance, covers and reimburses an insured for the cost of flooding damage to a building and its contents by excess water on normally-dry land. In Pennsylvania, flooding is the most common natural disaster and occurs when water partially or wholly covers a previously dry expanse of land or affects more than one property. Although heavy precipitation, overflowing rivers, and lakes are typically responsible for flood events, coastal surges, heavy snow melts, and failed dams/levees have also led to major flooding incidents in Pennsylvania. For example, the Commonwealth’s worst flooding incident, the Johnstown Flood, was caused by a failed dam in 1889 and resulted in over 2,000 deaths and 1,600 destroyed homes. Flood damage is also typically significantly more expensive than other types of claims: floodwater damage can exceed $25,000 for just one inch of floodwater in a home.

Flood insurance can be purchased through licensed P&C insurance agents who are certified to offer flood coverage from the FEMA’s National Flood Insurance Program (NFIP) or state-licensed property and casualty insurers. However, you can only buy the NFIP’s flood coverage if you reside in one of their 23,000 participating communities nationwide. 19 of Pennsylvania’s 67 counties do not participate in this program and are, thus, ineligible for this coverage type. Typical flood insurance policy becomes effective after a 30 day waiting period_ _and does not protect a person against sewer backup damage if it is not caused by a flood.

Flood insurance coverage can be purchased for up to $250,000 for a dwelling and $100,000 for the property’s contents. The insurance rates are determined in part by mapping a specific community to assess its flood risk. An area can be mapped as either a high, moderate, or low-risk flood area. In 2021, the Commonwealth of Pennsylvania released a flood mapping tool to help residents conveniently learn about their community’s or property’s flood risk. High flood-risk areas or Special Flood Hazard Areas (SFHAs) include communities located along the banks of the state’s 83,260 miles of rivers, such as Harrisburg County, Snyder County, and Northumberland County. An estimated 2.4 million Pennsylvanians live in these areas along the coast. These high-risk flood locations also fall within the FEMA’s 100-year floodplain, which projects areas with a 1% chance of flooding annually for 100 years. Pennsylvanians within these areas are required to maintain flood coverage for additional protection. However, all residential and business property owners are encouraged to buy flood coverage as recent statistics have shown that only 10% of flood reports to the National Weather Service (NWS) originated from the FEMA 100-year floodplain.

Earthquake Insurance

Earthquake insurance in Pennsylvania provides financial protection against damages and losses caused by earthquakes to residential and business property. It also covers the cost of additional living expenses incurred if your property becomes uninhabitable and you need to find temporary shelter while repairs are ongoing.

Pennsylvania's nearly 6 million homes and over 2 million commercial properties are not at high risk of damage or destruction by earthquakes because of the low-to-moderate seismic activity. Only smaller earthquakes have been felt in the southeastern and northwestern regions of the Commonwealth. Historically, the Commonwealth’s most significant earthquake occurred in 1998 in the areas surrounding Pymatuning Reservoir in the northwest section of the state. This 5.2 magnitude event injured only one person and damaged local groundwater systems more than it did buildings. State law does not mandate residents to have earthquake coverage except if they reside on major fault lines. Mortgage lenders, on the other hand, require earthquake insurance from prospective persons who reside or run their business in high-risk earthquake locations to protect their investments.

Windstorm Insurance

In Pennsylvania, windstorm insurance protects an insured’s home and personal belongings from winds or hail-related damages and losses. Although homeowners, renters, or commercial property insurance provides wind and hail coverage, it is often excluded for property owners and renters in high-risk locations. It can be purchased either as an add-on coverage or a stand-alone policy. Pennsylvania windstorm insurance has five specific coverage areas, namely:

• Dwelling coverage

• Other structures coverage

• Personal property coverage

• Loss of rent coverage

• Loss of use coverage

Windstorm insurance only pays out claims after the applicable wind or hail deductible has been paid, which is usually a percentage of the dwelling coverage (between 1% and 5%).

Sinkhole Insurance

Sinkhole insurance, in Pennsylvania, reimburses an insured for the financial cost of repairing or rebuilding their property or its foundation in the event of a ground depression or sudden ground collapse. It generally does not protect the structure’s contents or your living expenses if a sinkhole event forces you to stay in alternative accommodation.

Sinkholes are not a statewide peril and commonly happen in the south-central and south-eastern parts of Pennsylvania, where karst or large limestone/dolomite bedrock runs. According to the Pennsylvania Department for Conservation and National Resources (PA DCNR), about 7% of Pennsylvania’s terrain is vulnerable to sinkhole perils because of its characteristic karst landscape. You can confirm whether your property is located within a sinkhole-prone area online by checking the United States Geological Survey (USGS) or the Pennsylvania Geological Survey website. Since not all sinkhole insurance policies cover both naturally occurring and man-made sinkholes, you should thoroughly study your policy document and further discuss it with a Pennsylvania-licensed P&C insurance expert to ensure proper coverage.

Do you Need Disaster Insurance in Pennsylvania?

Yes. In the Commonwealth of Pennsylvania, standard property insurance excludes coverage for certain types of natural disasters, including floods and earthquakes. Identifying the prevalent natural disaster(s) in your locality and purchasing the requisite coverage ensures that no coverage gaps exist, hence guaranteeing your protection from future unexpected damages/losses.

Of the over 5 million housing units in the Commonwealth, 69% are owner-occupied, and approximately 3.1 million of these homes are insured. This means that nearly 2 million uninsured residents are at risk of becoming homeless in the event of a major weather hazard. This also applies to the proportion of property owners who solely maintain standard residential or commercial property insurance. You are spared this risk if you have comprehensive disaster insurance coverage.

Disaster-related damages/losses, especially flood damage, often far exceed typical out-of-pocket expenses of an average person or FEMA’s $5,000 per-household grants. For example, in 2017, the average claim for flood damage was over $90,000. Pennsylvania’s designation as one of the most flood-prone states also heightens your need for disaster insurance in the Commonwealth. Furthermore, you should still purchase flood insurance even if your property is situated outside designated disaster-prone areas. For instance, homeowners and renters in Pennsylvania’s flood plains and other areas earlier classified as low-to-moderate risk accounted for 25% of flood claims.

You also need disaster insurance if you own a commercial property in Pennsylvania, especially if it is situated within high-risk disaster areas. Regular commercial property insurance offers protection from some types of natural perils, including winds and lightning but is inadequate to cover catastrophic weather events like hurricanes and earthquakes. The over 300,000 business establishment owners operating in the state may be adversely affected if they fail to purchase additional insurance coverage. Possible natural disaster impacts for a business include:

• Business interruptions

• Damage/ loss of commercial property and/or equipment

• Customer dissatisfaction

• Loss of revenue

• Job losses

In Pennsylvania, you generally need disaster insurance if you are:

• A homeowner

• A vehicle owner

• A renter

• A landlord

• A commercial property owner

You can employ the services of a professional state-licensed P&C agent in the Commonwealth to help you analyze your coverage needs. An knowledgeable agent will determine what specific disaster coverage and pricing is best suited for you based on your location.

What Should I Do after A Natural Disaster in Pennsylvania?

In Pennsylvania, natural disasters such as flooding and wildfire are often accompanied by widespread damage/destruction of residential and commercial properties. They may also lead to deaths/fatalities in certain cases. However, individuals and businesses with the appropriate disaster insurance coverage can expect compensation for covered losses/damages subject to their policy limits. In contrast, those without any type of natural disaster insurance coverage will have to pay out of pocket (or seek government assistance) for expensive repair or rebuilding costs after getting hit by a natural disaster.

The aftermath of a natural disaster in Pennsylvania can leave you reeling and feeling confused. Make sure that you are prepared ahead of time and know what you need to do after the disaster strikes: Do you know which types of damages do your policies cover? Do you know how to file a claim with your insurer? Do you have all the contact information saved in an accessible place where you can easily find it, even if you are displaced from home?

Once the disaster occurs, if you have any questions about the coverage or need help with figuring out or filing the claim, contact the insurance agent who sold you the policy. Your agent should help you through the process of streamlining the communication with the insurers. In the absence of your personal agent, contact the insurers directly and speak with their staff agents, who can help you file the claim.

If you cannot get help through the insurer, contact the Pennsylvania Insurance Department at 1-877-881-6388 or via email.

Post-Disaster Steps

1. First, ensure that you and your loved ones are safe and accounted for. Confirm if any injury was sustained and ascertain the severity of the injuries to determine the immediate medical attention required. Certain natural disasters, such as floodwaters and wildfires, in addition to property damage/loss, can cause injuries and deaths

2. Notify your insurance agent or insurer directly of the damage/loss caused by the covered natural disaster. Your insurer will send their adjuster to review the extent of the damage once you notify them. Also, study your insurance policy document to understand the claim process along with other stipulated policy terms and conditions. Ask your agent and the insurer any questions that will help you understand the process.

3. Assess the extent and type of the damage to determine what type of insurance claim to file by engaging the services of a reputable and licensed local property contractor. Homeowners insurance covers property damage to an insured’s residence while flood-damaged cars are only covered by comprehensive auto insurance. Also, make a detailed record of the damaged sections or destroyed property. Certain types of damages are specific to a certain natural disaster. For instance, hurricanes and tornadoes typically cause roof damage, while sinkholes and earthquakes can cause structural damage, such as wall cracks and damage to a building’s foundation. Meanwhile, floodwaters typically result in mold in all parts of the building that was submerged.

While assessing the damage, take as many photos as you can.

4. Apply any temporary repair necessary to prevent further damage to your property to avoid having your claim denied. For example, properly secure the entryways to prevent theft of your valuables or possessions. You should also remove your high-priced items if your residential or business property becomes uninhabitable after a disaster. Keep a list of such things on hand, so you can find them fast in a rush during the evacuation.

5. Submit all the relevant documentation, including photos, property receipts, property journal or inventory, and other records necessary to process your claim to your insurance adjuster. Also, provide your insurer with documentary proof of expenses incurred for staying in alternative accommodation (for residential properties)

When dealing with the aftermath of a natural disaster, contact your insurance carrier as soon as possible. Since natural disasters often trigger multiple claim requests in their wake you will be one of the many others filing a similar claim. Filing early places you in the front of the line.