The Rising Cost of Lightning

According to the Insurance Information Institute, the cost of claims attributed to lightning has been increasing each year, even though the number of claims filed has not increased. In 2011, nearly $1 billion of home insurance claims were paid as a result of lightning-generated damages. With the continual threat of lightning strikes, you should review your home insurance policy and also evaluate any protective measures you should be taking around your home. Do not underestimate the threat of damage or injury from lightning, even if you are inside your home.

The standard home insurance policy will cover damages to your home arising out of fire and lightning. However, you should be aware of some potential limitations on coverage that may affect your recovery as a result of lightning strikes. For example, if lightning resulted in damage to your computer equipment, most home insurance policies have a limitation on the total amount covered. If you have a lot of equipment or very high-value items, you should consider adding a floater to your regular policy. With sensitive computing hardware, the power spike from a lightning strike can quickly cause enough damage to exceed the coverage sub-limit on a standard homeowners insurance policy.

In addition, if lightning strikes a tree on your property, most home insurance policies will pay for the removal and replacement of the tree. Keep in mind that this coverage on the standard policy usually has a sub-limit of 5% of the total limit on the policy. In addition, the policy will often limit your insurance for the replacement of any one tree to no more than $500. If your house is landscaped with many mature trees, you should consider requesting a higher limit for landscape coverage on your home insurance policy.

The Lightning Protection Institute provides good information on their website on how to prepare for and protect against lightning strikes. For example, you can install lightning protection systems that can protect your home by channeling the energy from a lightning strike to ground rods, bypassing your house. This diverts the powerful energy from a lightning strike and prevents it from running through your home, preventing fire and power surges. In addition to your house, the Institute recommends protecting tall trees and those within 10 feet of the house with a lightning protection system. Without protection, the tree can damage the house after it has been struck by lightning by creating a fire hazard.

Diverting the current from the home and installing surge suppressors can also prevent damage to sensitive electronic equipment. This requires more than just a power strip with surge protection. One of the reasons for the rising cost of lightning claims is the increased use of expensive electronic equipment in homes. You probably have at least one computer and home theater system in your house. As these types of items become more common in homes, the cost of damage from lightning-induced power surge also increases substantially. Proper surge suppressors are a component of the entire home’s lightning protection system and consist of arrestors installed at electrical panels, as well more local suppressors installed throughout the home for specific devices.

It’s impossible to prevent lightning from striking your property, but you can take steps to minimize the damage lightning causes. By having adequate home insurance, you can also be protected from the financial impact of the damage caused by lightning.

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