Check Your Insurance

Inland residents shouldn't grow complacent about the damage storms can do to their homes and properties. High winds and flooding, while most likely to hit coastal communities, can also wreak havoc on inland areas.

The problem is, most homeowners wait until a hurricane is bearing down on them before they start wondering what kinds of damage are covered by their insurance policies. Once a hurricane warning is declared, insurance companies close their doors to new business.

Now is the time for homeowners to review their policies to understand what is covered -- and what isn't -- in the event of storm damage, insurance officials say.

Homeowners policies usually cover damage from wind and rain, but most carry a hurricane deductible of between 2 percent and 5 percent of the home's value.

Check to see how much your insurer will pay to rebuild your home. The amount should reflect the current value of the home, which should be adjusted automatically by your insurer each year.

A big misconception is that flood damage is covered by the typical homeowners policy. It isn't. Most homeowners policies don't cover damage caused by rising waters.

For example, if a hurricane tears the roof off a home and rain damages the owners' belongings, the homeowners policy would pay to repair the home and replace possessions. But if the water from a flooded street or lake invades the home, the owners are out of luck unless they bought flood insurance.

Flood policies are administered by the federal government's National Flood Insurance Program. They can be purchased through traditional insurers, which act as administrative middlemen for the government.

The government had to step in to insure homes built in flood plains -- areas designated by state and local authorities as being susceptible to flooding -- because private insurers wanted nothing to do with them.

If you live near the gulf, or a large lake or river, you may already have flood insurance. That's because most banks won't grant a mortgage to people buying homes in flood plains unless they are insured against water damage.

But not every area surrounding a body of water is designated as a high-risk area. Homeowners who are unsure whether they live in a flood plain should call their insurance agents, who should have that information on hand.

Keep in mind that homes that aren't built in high-risk areas can flood too. One of every four flood disasters in the United States occurs in an area outside of a flood plain, according to the Federal Emergency Management Administration, which manages cleanup efforts after natural disasters.

So how do you know if you need flood insurance? Agents say homeowners must decide for themselves whether it's worth the extra cost, which can be as low as $200 per year for people living outside of flood plains.