Homeowners insurance: six tips for a storm

Hurricane Irene is bearing down on the East Coast. In its path are cities that haven't taken direct hits from a hurricane in years, and in some cases decades.

It's a good time to review how much hurricane damage coverage you can expect from standard homeowners, renters and automobile policies. Here are six insurance tips as the East Coast braces for Irene:

1. Take a property inventory: It's easier to file a damage claim if you know exactly what you own, and can document it. Free online software to help ease the process is available from the Insurance Information Institute at www.knowyourstuff.org . The software enables users to upload photos of property as well as scanned receipts from major purchases. Or, a homeowner can write down a list of major property in a notebook, and take photos, noting key information about each item on the back.

2. Check policies: Read your insurance documents and review the scope of your existing coverage. Know your policy numbers, and where to call to file a claim. Call your agent or insurer with any questions. If you don't have hardcopy of your policy, be sure to check it online before the storm hits — you may not have power for a while after the storm. Don't expect to get a new or expanded policy in place before Irene hits.Insurers typically bar last-minute coverage changes as storms approach.

3. Know your policy's hurricane deductible: A standard homeowners insurance policy includes a deductible, meaning thehomeowner must pay for a portion of the damages before insurance covers the rest. Typically, that's either $500 or $1,000. However, out-of-pocket expenses for hurricane damages can be much higher. In 18 states on the East and Gulf coasts, insurers are allowed to include hurricane deductibles in homeowners policies. These amounts apply only to hurricane-caused damage, and typically range from 1 percent to 5 percent of theinsured value of a home. Deductibles may be higher in some coastal areas. For example, a policyholder whose home is insured for $200,000 with a 2 percent hurricane deductible would have to pay the first $4,000 to repair hurricane damage.

The hurricane-prone states that allow insurers to assess hurricane deductibles include: Alabama, Connecticut, Delaware, Florida, Georgia, Hawaii, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Jersey, New York, North Carolina, Rhode Island, South Carolina, Texas and Virginia. The District of Columbia is included.

"Many homeowners have forgotten about these deductibles, because they live in places that haven't had a hurricane for years," said Michael Barry, a spokesman for the Insurance Information Institute.

Hurricane deductibles within those states may vary from insurer to insurer. Homeowners may also face a higher deductible the closer they are to the coast. Look for the deductible percentage and other details on a "declarations" page, the first page of a homeowners policy. Policies also indicate how severe a hurricane must be before a hurricane deductible applies to a damage claim. Often, the trigger is whether the National Weather Service officially names a tropical storm, as it has in the case of Hurricane Irene. Or, a named hurricane may have to reach a specific level of intensity on a scale that runs from a low-level Category 1 to the most severe, Category 5. On Friday afternoon, Hurricane Irene remained at Category 2, with maximum sustained winds near 100 mph. Some policies set the bar lower before a hurricane deductible can be assessed, such as the issuance of a hurricane watch or warning.

4. Water inside? You need flood insurance: Don't expect flood-related damage from a hurricane to be covered unless you've got flood insurance. Standard homeowners and renters policies cover damage from wind, including hurricane wind damage, and any wind-driven rain entering a home from the sky. But damage from water on the ground, or water seeping into a basement from below, isn't covered unless a homeowner has a flood insurance policy. Flood coverage is available from the National Flood Insurance Program and from a few private insurers. The Insurance Information Institute estimates that fewer than one-fifth of U.S. homeownershave a flood insurance policy, although four out of five natural disasters involve flooding. Consumers can find out their risk of a flood and the cost of a policy by going to the NFIP's website at: www.floodsmart.gov . There's typically a 30-day waiting period from the purchase date before a flood policy takes effect.

5. Water in your car? You need comprehensive auto: If your car is damaged by flood waters from a hurricane or other disaster, expect to be covered if you've purchased a comprehensive auto insurance policy. About 80 percent of U.S. drivers have comprehensive coverage. If you've only got liability coverage, flood damage to a car won't be covered.

6. Tree damage: Standard homeowners policies cover damage to a house from a fallen tree, and tree damage to garages, sheds, fences and outdoor pools. Comprehensive auto insurance will cover damage to a car.

It gets trickier when a tree in your yard falls onto a neighbor's property. Generally, the neighbor'shomeowners policy will cover those damages, said Ed Charlebois, vice president of personal insurance with The Travelers Insurance Cos. However, you could be liable if your neighbor warned you that the tree was weak before the storm, and you didn't do anything about it.