After exploring various topics for this month’s article, I’ve returned to what I know
best. Anyone residing in or with financial interests in the Gulf States, along the
Eastern Seaboard, Hawaii, Mexico, or the Caribbean should consider hurricane
preparedness as mission critical. The 2024 season reminded us of the significant
uncertainty between hurricane forecasts and actual events. While storm frequency
can’t be predicted, we must prepare as though a severe hurricane is inevitable in the
2025 season. We must further consider that data confirms that storms which do
form will be significantly more severe than those of the past due to rising sea
surface temperatures, independent of all other factors. Don’t expect it to get better.

Whether you own a single-family home, oversee an association’s interests, or
manage a large portfolio of assets, hurricane preparation should begin with an
honest assessment of your financial liabilities in the event of a catastrophic storm.
Reflect on your past experiences with hurricanes and evaluate your exposure over
the next one, five, and ten years.

1. Review your insurance policies to fully understand your coverage, including
deductibles, exclusions, limitations, and renewal dates. Then, consult your
insurance agent(s) with any applicable questions. They are there to help and
will welcome the opportunity to assist.

2. Identify gaps in risk transfer after assessing the coverage you have in place.
This includes the gap between zero and your deductible, exposures excluded
or limited by your policy, and risks that are not transferred to the insurance
market at all.

Once you understand your risk exposure, create an action plan to close the gap
between undesired risk retention and transferred risk. Consider the cost of
insurance in relation to deferred maintenance and property vulnerabilities.
Everyone’s risk tolerance varies, but the better you understand your options, the
more control you have over your outcomes.

1. Consult your insurance agent & risk consultant to determine the most cost-
effective way to close risk transfer gaps. This may involve prioritizing deferred
maintenance, strengthening property resilience, adjusting insurance
coverage, or strategizing alternative financial safeguards for retained risk.

2. Develop a written checklist outlining the steps you will take to achieve your
risk management goals by July 1, 2025. While a June storm could occur, early
July is a statistically sound target for completing your yearly hurricane
planning, especially considering that it is already mid-February.

3. Obtain necessary approvals, whether from your spouse, board, or capital
partners, before executing your plan. Once approved, shift into action mode
to ensure everything is in place in time.

Planning for human safety is even more critical than protecting financial interests.
Anyone at risk should have a written hurricane safety plan that begins with the
fundamental question: Will I stay or evacuate? Deft recommends the following
essential components for an effective hurricane plan:

1. Establish a clear evacuation threshold based on guidance from local
emergency management agencies and unique property-level attributes.

2. Prepare a supply list tailored to your specific exposure and occupancy
needs. Go beyond shelter, food, medication, and power generation.
Connectivity and cash can be just as crucial. Don’t forget your pets; if you
evacuate, they go too.

3. Define preparation and recovery procedures by outlining the steps to take in
the days and hours before a storm’s landfall, followed by an action plan for
post-storm recovery. Consider who, if anyone, will remain on the property
during the storm to ensure your plan is realistic. Coordinate with family,
employees, vendors, and others to maximize safety and efficiency.

Short-term memory breeds complacency. In Florida, for example, residents along
the West Coast who were recently impacted by storms have a heightened
awareness of hurricane risks. Meanwhile, some on the East Coast may assume
they’ll never face a hurricane again. As those who know me understand, I believe in
data and statistics. Flip a coin enough times, and it will land on heads. I also believe
in personal responsibility. Have a plan or be subject to the plans of others.

-Jeremiah Kiefer