What would happen in the event of a Hurricane?

[missymouse]

We are seriously considering buying into DVC however my husband is concerned about what would happen if any of the resorts were hit hard by a hurricane and suffered significant damage. Would the maintainence fees go up sky high, would there be a one time charge, or would Disney's insurance cover it? We are thinking about Hilton Head at this time because we think we would go there probably more often than the WDW resorts and we are ok with the 7 month window for those resorts. But Hilton Head also is in the path of hurricanes frequently. If anyone has the information or if any Hilton Head owners would be willing to find out the information I would appreciate it.

 

[ascardino]

I am also curious.....

 

[sistertrip]

Are there any owners who have had to deal with the consequences of a hurricane?

 

[Chuck S]

The resorts are insured. If they are damaged beyond repair, or if they are severely damaged and there are only a few years left on the contracts the insurance proceeds can be divided amongst the owners and the resort closed...they would no longer be part of DVC. They could get a one-time charge if there are damages beyond what insurance and other state/federal funds would cover, and there is still aresonable useful life left tohe resort. They did announce that a one-time charge was a possibility for Vero Beach after being damaged by two hurricanes in the same year, but insurance and other programs covered the damage and there were no surcharges.

 

[Disneyaholic]

Perhaps a Vero Beach owner can answer the question, as that resort was damaged by hurricanes a couple of years ago.

However, if it eases your mind at all, it has been over 100 years since Hilton Head Island has had a direct hit from a hurricane. I have been there a few times shortly after severe storms and it is amazing how quickly everything is cleaned up and back to normal!!!

 

[Chuck S]

Also, if the resort suffers major damage and is closed for a prolonged period to rebuild, the members may be restricted and not permitted to use their points at other locations, even within the DVC system, as they have no trade value if the resort is closed.

 

[Dean]

We are seriously considering buying into DVC however my husband is concerned about what would happen if any of the resorts were hit hard by a hurricane and suffered significant damage. Would the maintainence fees go up sky high, would there be a one time charge, or would Disney's insurance cover it? We are thinking about Hilton Head at this time because we think we would go there probably more often than the WDW resorts and we are ok with the 7 month window for those resorts. But Hilton Head also is in the path of hurricanes frequently. If anyone has the information or if any Hilton Head owners would be willing to find out the information I would appreciate it.

The truth is the members at any given resort (DVC or not, WDW or not) are responsible for their resort. It's entirely possible to get hit with a Special Assessment, have to pay dues even when you can't use your points or even have the resort destroyed and not rebuilt and get nothing in return. And it's likely dues would go up if something major happened, VB can expect this over the next few years.

But overall small risks IMO, certainly less than owning a condo or house in the same area.

 

[byoung]

I would fell save at Disney thru a huricane, was there last Oct during Wilma, only got some winds. They still closed the parks on Monday reopened at 1 pm.

 

[missymouse]

I called DVC today with a few questions. The hurricane scenario was one of the things I asked about. The guy I talked with verified that insurance would most likely cover the majority of the cost for repair but if the cost was more than the insurance coverage they would consider an assessment for those who own points at that resort. However this has never been necessary.

He also said that in the event that your "home" is closed for repairs that you could still use your points at any other resort.

 

[Dean]

I called DVC today with a few questions. The hurricane scenario was one of the things I asked about. The guy I talked with verified that insurance would most likely cover the majority of the cost for repair but if the cost was more than the insurance coverage they would consider an assessment for those who own points at that resort. However this has never been necessary.

They came close at VB recently.

He also said that in the event that your "home" is closed for repairs that you could still use your points at any other resort.

Per FL statutes, this is true on a limited basis assuming it is a "temporary" situation. In that event, they would compete with the other members at the 7 month window with some being left out but still having to pay their yearly dues. If the decision is not to rebuilt that portion, those owners would immediately cease to be a member of the club.

 

[JimMIA]

I would fell save at Disney thru a huricane, was there last Oct during Wilma, only got some winds. They still closed the parks on Monday reopened at 1 pm.

That's because Wilma didn't get within 100 miles of WDW! I'd have to go back and look at the windfield maps to be sure, but I doubt if WDW even got tropical storm winds...sure as heck didn't get anything at ALL like a hurricane.

 

[lovwdwalot]

They came close at VB recently.

If the decision is not to rebuilt that portion, those owners would immediately cease to be a member of the club.

Hey Dean, do you know if this were to happen were the members who paid cashed or had paided off their loan would they rceive some type of money back from DVC?

 

[Dean]

Hey Dean, do you know if this were to happen were the members who paid cashed or had paided off their loan would they rceive some type of money back from DVC?

It's no different than you total a new car with a large loan where the loan is more than the value of the car. The so called "upside down" loan. In the situation where they decided to call it quits for a given component, the law says that any cash left over including insurance would be distributed among the owners there. I'm sure it would be applied to the loan if one was existing. IF this were to happen, you can bet there would be many people who owed more than they got, likely a lot more. And they would still be obligated to pay the loan but the dues would stop at that point. Now this could be a single building such as a beach house and would affect ONLY the owners in that portion, it would not be spread out over all the owners. Some would be unlucky and others now. The question is which is which as the dues would likely go up dramatically for the remaining owners.

My devious mind was kind of hopping for a SA at VB this year. Not to hurt the owners there but to see how DVC would handle it. One thing to note is this. FL law gives developers the option of not paying dues on what they own but essentially acting as the bank. DVC has chosen this option and as far as I know, have not changed that election. As I read it, they would guarantee to cover any under $$$ in a given year. There would be no mechanism for them to recoup the money. IMO, the same situation that would generate a SA could trigger this clause as well. I guess they could simply put it off till "next year" and raise fees. I was hopping this concept would get tested and I'm betting DVC would have lost and had to eat the difference. Or maybe they did and just didn't say so rather than the insurance covering it all.