Insurance Preparedness Tips for Hurricane Season

As the 2026 hurricane season begins, the Cayman Islands Monetary Authority (“CIMA”) is urging all residents across the Islands to take proactive steps to ensure they are adequately insured against the devastating effects of natural disasters. While a below average hurricane season is predicted, there is no room for complacency, as it only takes one major hurricane to cause devastation and significant loss.

The growing intensity and unpredictability of hurricanes and other extreme weather events such as heavy rain, high winds, flooding, earthquakes, and tsunamis serve as a stark reminder of the importance of disaster preparedness. These natural events can cause catastrophic damage to properties and even lead to loss of life, often extending many miles inland. Disaster preparedness experts have emphasised that, given the increasing frequency of these events, the public must be better prepared to manage the financial consequences of such disasters.

As we are not able to predict natural disasters, it is of utmost importance to safeguard and insure your property. As part of its ongoing hurricane preparedness and public awareness efforts, CIMA remains committed to promoting greater awareness of disaster risks and ensuring that both its employees and the broader community are well-informed and equipped to manage potential financial losses resulting from natural disasters. A recent study conducted by CIMA, concluded that approximately 70% of residential and commercial properties in the Cayman Islands are insured, inferring a protection gap of 30%.

When assessing whether your property — including your home and its contents, vehicle, or boat — is adequately covered against damage caused by natural disasters, consider the following preparedness tips:

• Review and Discuss Your Policy: Carefully examine your current property insurance coverage with your insurer or broker. Some policies may include hurricane, flood, earthquake, and tsunami coverage as standard, while others may offer them as add-ons. Your property policy will include a deductible, so it's important to understand your potential out-of-pocket costs in the event of a claim, as well as any exclusions or sub-limits that may apply.
• Know Your Property Values and Replacement Costs: Construction costs and property values can increase due to inflation and other factors. Review your sums insured regularly to avoid underinsurance penalties. Remember, if your property is underinsured, you may not receive the full value of your claim. Consult your insurer or broker to verify that your coverage is adequate.
• Catalogue Your Contents: Take a comprehensive review of your contents to ensure you have adequate coverage to replace your possessions against current policy limits.
• Use Licensed Insurance Providers: Always ensure that your insurance company or broker is duly authorised. Licensed domestic insurance companies, agents, and brokers can be searched for on the CIMA website.

For additional insurance preparedness tips and more information on disaster planning, please visit: https://www.cima.ky/general-consumer.