Most homeowners in Grenada do not think hard about their insurance policy until the morning after a storm. That is when they discover what their deductible really means, whether their sum insured covers the cost of rebuilding, and which items the policy does not cover at all. After Ivan in 2004, many owners learned these lessons the hard way, and Beryl in 2024 brought similar discoveries on Carriacou and Petite Martinique.
Home insurance in Grenada is offered by local and regional insurers and through agents and brokers, and insurance companies are regulated by the Grenada Authority for the Regulation of Financial Institutions (GARFIN). Policies differ in detail, so the points below are a guide to the questions you should ask, not a description of any particular insurer's terms.
This article explains how windstorm cover usually works, how percentage deductibles and underinsurance can reduce a payout, what is commonly excluded and how to prepare so that a claim, if it comes, goes as smoothly as possible.
What a typical home policy covers
A standard homeowner's policy covers the buildings against named perils such as fire, lightning and explosion, and usually includes windstorm, hurricane and sometimes earthquake as standard or as an add-on. Contents can be insured under the same policy or separately. Some policies also include liability cover and alternative accommodation costs if the house becomes uninhabitable.
Windstorm and hurricane cover is the most important element for most Grenadian homes, and also the most expensive. Insurers price it according to location, construction type, roof design, age and condition, and they may ask about shutters, roof connections and maintenance. Some insurers will not provide new cover once a named storm is approaching, so arrange or change cover well before the season.
Flood, storm surge and landslip cover can be treated differently from wind damage. Some policies cover water damage only when it enters through storm damage to the roof or openings, and exclude rising water. If your house is near the sea or a river, ask specifically how flood and surge damage are treated.
How hurricane deductibles work
A percentage, not a fixed amount. Many Caribbean home policies apply a separate deductible for windstorm or hurricane damage, calculated as a percentage of the sum insured rather than a fixed sum. Percentages in the low single digits are common, but check your own policy.
An example. On a house insured for EC$800,000 with a 2 per cent hurricane deductible, the owner bears the first EC$16,000 of any hurricane claim. At 5 per cent, that rises to EC$40,000. The figures are illustrative only.
Applies per event. The deductible is normally applied to each storm. Two damaging storms in one season can mean two deductibles.
Small damage may not be claimable. If repairs cost less than the deductible, the insurer pays nothing. Many owners only realise this after a minor storm.
Plan for it. Keep savings equal to at least your hurricane deductible. The money will be needed quickly after a storm, often before any claim is settled.
Underinsurance and the average clause
The most damaging mistake is insuring a house for less than it would cost to rebuild. Many policies contain an average clause: if the sum insured is below the true rebuilding value, the insurer reduces any claim in proportion. For example, if a house would cost EC$1,000,000 to rebuild but is insured for EC$600,000, a claim for EC$200,000 of damage might be paid at only 60 per cent, before the deductible is applied.
Rebuilding cost is not the same as market value or the price paid. It is the cost of demolishing damaged parts, clearing debris, paying professional fees and rebuilding to current standards with current materials and labour costs, which can rise sharply after a regional disaster when demand spikes. Land value is not included, since the land does not need rebuilding.
Ask a quantity surveyor or experienced valuer to estimate the rebuilding cost, especially for larger or unusual houses, and update the sum insured as construction costs change. Review it every year at renewal, and after any extension or major improvement. Some policies offer automatic index-linking of the sum insured; ask whether yours does and what index it follows.
Common exclusions and conditions to check
Read the policy wording itself, not just the summary. Points that often matter after a storm include:
- whether boundary walls, fences, gates, driveways, swimming pools and outbuildings are covered, and on what terms;
- how solar panels, water tanks and equipment on the roof are treated;
- cover for damage caused by flood, storm surge and landslip, as distinct from wind;
- exclusions for poor maintenance, wear and tear, rot or termite damage that contributed to the loss;
- conditions requiring shutters to be in place or the property to be occupied or checked regularly;
- unoccupancy clauses that limit cover if the house is empty for more than a set period;
- limits on high-value contents such as jewellery, electronics and art;
- whether alternative accommodation or loss of rent is covered while repairs are made;
- the time limits for notifying a claim and submitting supporting documents.
Preparing now for a claim later
A smooth claim starts long before the storm. Before each season:
- Review the sum insured against a current estimate of rebuilding cost.
- Read the hurricane deductible and calculate what it means in dollars.
- Photograph and video every room, the roof, the exterior and major contents, and store the files off the island or in secure online storage.
- Keep copies of the policy, receipts for major purchases and records of upgrades such as shutters and roof straps.
- Note your insurer's or agent's claim procedure and the details you will need to report a loss.
- Make sure maintenance is up to date and documented, since neglected roofs or gutters can complicate claims.
- After a storm, photograph damage before temporary repairs, then take reasonable steps to prevent further damage and keep receipts for that work.
Choosing an insurer, agent or broker
Price matters, but after a regional disaster the qualities that count are financial strength, local claims capacity and how quickly adjusters can reach your house. Ask how the insurer handled claims after recent storms in the region, whether it uses local or visiting adjusters, and how payments are made to owners who live abroad. An insurer with strong reinsurance arrangements is better placed to pay when many claims arrive at once.
Agents represent one insurer; brokers can compare several. Either way, ask them to explain the hurricane deductible, the treatment of flood and surge, and any conditions about shutters or occupancy in plain language, and confirm the important points by email so you have a record.
If you have a mortgage, your lender will usually require buildings insurance and may need to be named on the policy. You can often still choose the insurer, provided the cover meets the lender's requirements. Contents cover and liability cover are your own decision and are worth considering separately, especially for rented-out or holiday homes.
Mistakes that cost owners at claim time
Insuring the purchase price. Purchase price includes land and market conditions; rebuilding cost is what matters. A house bought cheaply years ago may cost far more to rebuild today, while a house bought at a premium for its view may need less cover than its price suggests.
Ignoring the deductible. A percentage deductible on a large sum insured can be a substantial amount of money.
Letting cover lapse. Missed renewals, especially for owners abroad, can leave a house uninsured just when the season starts.
Throwing away evidence. Clearing damage before photographing it, or discarding damaged items before the adjuster sees them, weakens a claim.
Assuming the mortgage policy is enough. Lender-required cover may protect the loan rather than the full value of the house and contents. Check what it actually covers.
Frequently asked questions
Is hurricane damage covered by standard home insurance in Grenada?
Windstorm and hurricane damage is usually covered, either as standard or as an add-on, but often with a separate, higher deductible calculated as a percentage of the sum insured. Flood, storm surge and landslip may be treated differently. Check your policy wording and ask your insurer to explain any gaps.
What is a typical hurricane deductible in Grenada?
Hurricane deductibles are commonly a percentage of the sum insured, often in the low single digits, rather than a fixed amount. That can mean thousands of EC dollars on a typical house. The exact percentage varies by insurer and policy, so read your schedule.
How much should a Grenada house be insured for?
For the full cost of rebuilding it, including demolition, debris removal and professional fees, not its market value or purchase price. A quantity surveyor or valuer can estimate this. Underinsuring can reduce any claim in proportion under the average clause.
Can cover be bought when a hurricane is forecast?
Usually not. Many insurers suspend new cover or increases in cover once a named storm is threatening the area. Arrange or review insurance well before the season starts on 1 June, and keep renewals up to date.
Who regulates insurance companies in Grenada?
Insurance companies in Grenada are regulated by the Grenada Authority for the Regulation of Financial Institutions, known as GARFIN. If a dispute with an insurer cannot be resolved directly, owners can ask GARFIN about complaint options, and may also seek independent legal advice.
Does an empty holiday home stay insured?
Not always on the same terms. Many policies limit cover if a property is unoccupied for a set period, or require regular checks. Owners who spend part of the year abroad should tell their insurer and arrange for someone to inspect the house, especially before and after storms.
