Calculation table
| Coverage A | 2% | 3% | 5% | 10% |
|---|---|---|---|---|
| $300,000 | $6,000 | $9,000 | $15,000 | $30,000 |
| $500,000 | $10,000 | $15,000 | $25,000 | $50,000 |
| $700,000 | $14,000 | $21,000 | $35,000 | $70,000 |
| $1,000,000 | $20,000 | $30,000 | $50,000 | $100,000 |
| $1,500,000 | $30,000 | $45,000 | $75,000 | $150,000 |
How to choose
- 2%: max premium, min exposure. Recommended if low liquidity or advanced age.
- 3%: classic compromise. Most policies default to 3%.
- 5%: moderate premium savings (~15-20%), mid-range exposure. For owners with solid savings.
- 10%: large savings (~25-30%), maximum exposure. Only if you have $100K+ liquid in USD.
- Also consider: building value (Coverage A), annual rate (more cyclones = better lower deductible), distance to coast.
Hurricane vs AOP deductible
- Hurricane deductible: only damage from a declared hurricane (watch/warning + 72 hrs after).
- All Other Perils (AOP) deductible: fire, theft, plumbing leak, etc. Typically $1,000: $2,500.
- For tornado outside the hurricane window: AOP applies (usually lower).
- If unclear which deductible applies, insurer decides based on documented cause.
Payment and liquidity
- The deductible is never paid to the insurer. The insurer simply deducts it from any settlement.
- The insured pays the first repair invoices up to the deductible, then the insurer takes over.
- Major hurricane (total loss): $600,000 settlement minus $30,000 deductible = $570,000 paid to insured.
- The insured therefore needs $30,000 USD quickly accessible to pay contractors before the final settlement arrives (60-180 days).
- For Canadians: do not rely solely on a Canadian line of credit (conversion fees, delay). Keep a US account with sufficient liquidity.
Total loss and coverage limit
- If the home is 100% destroyed, max settlement = Coverage A − deductible.
- Coverage A must be updated annually to actual replacement cost (with construction inflation). Otherwise, underinsurance = reduced settlement (coinsurance clause, F.S. §627.701).
- If Coverage A < 80% of replacement cost, the insurer can proportionally reduce the settlement.
- Ask your broker yearly to review Coverage A. FL construction: typical +5-8%/yr inflation 2022-2025.
Official forms and reference pages
Reader responsibility
Verified fact: s. 627.701, Florida Statutes, requires insurers to offer hurricane deductible options of 500 USD, 2 percent, 5 percent, and 10 percent of the policy dwelling limits (with conditions where the specific percentage amounts fall below 500 USD), the percentage applying to the Coverage A dwelling limit, not to the loss. Source: Florida Statutes s. 627.701, 2025 text, flsenate.gov, consulted June 11, 2026.
Always use the latest version available on the official site cited below. Thresholds, rates and deadlines change. CanadaFlorida is not a substitute for a licensed professional.
A worked example: the same storm, three deductibles, 2026
Take a 400,000 USD Coverage A on a Venice house and a named-storm claim of 60,000 USD. At a 2 percent hurricane deductible, you self-insure the first 8,000 USD and the policy pays 52,000. At 5 percent: 20,000 yours, 40,000 paid. At 10 percent: 40,000 yours, 20,000 paid. The premium savings for the higher retentions are real but bounded. Typical range: moving from 2 to 5 percent commonly trims the wind portion of the premium by a few hundred USD a year on homes of this size, June 2026 market observation; against a 12,000 USD jump in retention, the break-even is one storm in many years. The calendar-year application rule matters too: the hurricane deductible applies per season's first loss mechanics as your policy defines, so read the form's wording on multiple storms in one year.
Opinion: pick the deductible against your reserve fund, not the premium line: 2 percent for owners who would borrow to cover a five-figure retention, higher only when the reserve genuinely exists. The premium saved is visible every year; the retention is invisible until the one September it is everything.
Who sets what
| Aspect | State (FL) | Federal US |
|---|---|---|
| Deductible menu | s. 627.701 mandates the offered options and disclosure wording | No federal role |
| Trigger | Named-storm definitions per policy form under Florida law | NHC naming conventions feed the triggers |
| Flood losses | Excluded from the dwelling form regardless of deductible | NFIP carries flood, with its own deductibles |
Common mistakes
- Reading the percentage as a share of the loss. It is a share of Coverage A: a 2 percent deductible on 400,000 USD is 8,000 USD whatever the claim size.
- Chasing premium with a 10 percent retention and no reserve. The saved hundreds meet a five-figure bill at the first storm.
- Forgetting the deductible when setting Coverage A. Raising the dwelling limit raises the retention arithmetic with it.
- Confusing hurricane and all-other-perils deductibles. The flat AOP deductible lives beside the percentage one; know which applies to which loss.
- Assuming flood rides on the same math. Rising water is the NFIP policy's file, deductibles and all.
The owner's deductible checklist
- Find Coverage A on the declarations page; compute each offered percentage in dollars.
- Match the retention to your actual reserve, in USD, not to optimism.
- Read the named-storm trigger and the multiple-storm wording in YOUR form.
- Re-run the arithmetic at every renewal: Coverage A moves with rebuild costs.
- Keep the reserve liquid through the season; September does not wait for transfers.
Frequently asked questions
What does a 2 percent hurricane deductible actually mean?
Two percent of your Coverage A dwelling limit, self-insured per the policy's hurricane provisions: 8,000 USD on a 400,000 USD limit, regardless of the claim's size.
Which options must insurers offer?
The s. 627.701 menu: 500 USD, 2, 5, and 10 percent of dwelling limits, with the statutory disclosure that your policy contains a separate hurricane deductible.
Does the deductible apply per storm?
Florida forms commonly apply it on a calendar-year basis with specific wording for subsequent storms; your form's language governs, so read it before the season.
Is the cheaper premium worth the 10 percent option?
Only with a genuine liquid reserve equal to the retention; otherwise the discount is a loan you grant yourself against the next landfall.
Does this cover storm surge?
No: surge is flood, excluded from the dwelling form; the NFIP or private flood policy carries it with its own deductible.
Every figure, rate, threshold, and deadline in this guide is drawn from a verifiable primary source listed at the bottom of the page. The article is updated whenever the underlying rules change, with a fresh review date stamped at the top.
Sources and references
Public sources verified as of the last review date (Florida Statutes, Florida Department of Revenue, Citizens, FEMA, DBPR).
- Florida Statutes s. 627.701: hurricane deductible options (500 USD, 2, 5, 10 percent) and disclosures, 2025 text, consulted June 11, 2026
- Citizens Property Insurance Corporation: deductible application on its forms, consulted June 9, 2026
- FEMA: NFIP flood coverage and deductibles (surge is flood), consulted June 9, 2026