Caribbean property insurance, flood and coastal-risk checks

Start with the particular site. Ask about previous flooding, roof damage, drainage problems, retaining-wall repairs, coastal erosion and periods when access was cut off. Request repair records, available insurance-claim information and the reports used for any major remedial work.

Visit the property and its surroundings with the appropriate professional. Discuss nearby waterways, ground levels, road drainage, steep slopes, sea exposure and the location of essential equipment. Put unresolved concerns into a written investigation list.

A useful property assessment records the source and date of each observation, the limits of the inspection and the further work required. Include the cost of that work in your buying budget.

The National Hurricane Center identifies wind, storm surge and rainfall flooding among tropical-cyclone hazards. Its hurricane category scale uses maximum sustained wind speed; storm surge and rainfall flooding require separate assessment. ^{[1] [2]}

Ask a suitably qualified professional how those hazards relate to the site, roof, openings, drainage and escape routes. For coastal property, discuss wave exposure and the condition of protective works. For hillside property, ask whether ground or slope investigations are appropriate.

Use hazard maps within their stated coverage and limitations. The National Hurricane Center cautions that its national storm-surge maps are unsuitable for parcel-level assessment. Ask the relevant local authority or professional which information is available for the actual address. ^[3]

Give the insurer the address, construction details, age, condition, intended occupancy and proposed use. Disclose planned holiday letting, extended vacancies, renovations and any known defects or previous losses requested in the application.

Request the wording and schedule alongside the premium. Ask the insurer to identify the covered events, exclusions, deductibles and limits for the building, contents, liability and any rental-income protection you need. Record conditions involving shutters, maintenance, security, inspections or vacancy.

Ask when cover can begin, which information remains outstanding and whether the lender has specific requirements. Retain the written answer with the purchase file.

Ask the insurer and valuation professional to explain how the building's insured value is established and how rebuilding expenses are treated. Clarify the treatment of professional fees, debris removal, outbuildings, boundary walls, pools and other external structures.

Find out how each deductible is calculated. A percentage deductible can be significant when applied to the insured value. For example, 2% of a hypothetical US$400,000 insured amount is US$8,000. The policy wording determines the actual basis, applicable event and minimum amount.

Ask what happens if the insured amount is inadequate. Obtain an explanation of any underinsurance or average condition and how often the valuation should be reviewed. Use the insurer's answer to set a practical cash reserve.

For a condominium or strata purchase, obtain the association's insurance schedule and ask which parts of the property it covers. Establish the unit owner's responsibilities for fixtures, improvements, contents, liability and any share of a claim deductible.

Ask the association about outstanding claims, renewal terms, planned repairs and the process for funding uninsured work. Read these alongside the accounts and reserve position requested during due diligence.

For a managed holiday home, ask the insurer how short stays and periods without guests are treated. Agree who checks the property, prepares for severe weather, documents damage and reports a claim. Record the manager's authority to approve urgent work and the spending limit.

Prepare a maintenance and emergency-contact schedule suited to the property. Discuss roof and drainage inspections, secure storage, backup arrangements and access after severe weather with the people responsible for the building.

Budget for the premium, relevant deductibles, routine maintenance and a period without rental income. Use the closing-cost guide for acquisition cash and the rental-income guide for an operating stress test.