Let $H$ be the Iwahori--Hecke algebra corresponding to any Coxeter group. Deodhar's defect statistic [Geom. Dedicata 36, (1990) pp.95--119] allows one to expand products of simple Kazhdan--Lusztig basis elements of $H$ in the natural basis of $H$. Clearwater and the third author gave a type-$A$ extension [Ann. Comb. 25, no. 3 (2021) pp.757--787] of this formula which combinatorially describes the natural expansion of products of Kazhdan--Lusztig basis elements indexed by smooth elements of the symmetric group. We similarly give a type-$BC$ extension of Deodhar's result which combinatorially describes the natural expansion of Kazhdan--Lusztig basis elements indexed by hyperoctahedral group elements which are simultaneously smooth in types $B$ and $C$.