San Antonio Express-News (Sunday)
Preparing for the next storm
insurance does not cover damages from rising water typically associated with flooding. That requires a separate policy.
But homeowners insurance does cover damage from falling water such as rain that gets under the eaves.
It also covers hail damage, tornadoes and wind damage that occurs inland.
Residents who live along the Texas coast typically must buy a separate wind policy to cover wind damage. Insurance experts recommend buying enough coverage to rebuild your home, which typically will cost more than buying a new house.
Insurance agents have a good idea what it will cost to rebuild, said Jim Gavin, spokesman for the Independent Insurance Agents of Texas. They also have a formula for calculating the cost of replacing your contents, including furniture, clothing and other personal items.
You also can take your own inventory to determine value.
One important decision to make when choosing coverage is whether to buy a policy that reimburses homeowners based on replacement cost or actual cash value.
Replacement cost is just that - it gives you enough money to buy another sofa like the one you lost.
Actual cash value depreciates the sofa you bought, say, a decade ago.
It may have cost you $2,000, but you may only get half that when wear and tear is calculated.
Actual cash value is less expensive but it may not be enough to put your life back together.
Renters: Renters policies cover personal property lost in a fire, theft or other disaster.
Renters need separate policies to cover flood damage.
Again, it’s important to buy a policy that covers what you could lose.
Take an inventory of your belongings to calculate how much it would cost to replace everything.
Flood: Flood insurance is backed by the federal government, but sold by insurance companies.
The maximum coverage is $250,000 for buildings and $100,000 for contents. Before deciding how much coverage you need, discuss with your agent how much it would cost to rebuild. Or ask friends whose homes flooded in one of the recent hurricanes and have intimate knowledge of how much it costs to install drywall, buy flooring and reconstruct kitchens and bathrooms.
If you have a $1 million home, consider buying excess coverage outside the regulated insurance market, recommends Gavin. Several companies provide flood coverage above the federal limits and offer extras not covered by federal flood insurance such as reimbursement of temporary living expenses.
However, the policies are not regulated like standard insurance policies and if the companies go under, policyholders often have little recourse to get the benefits they signed up for. One last point: Government- issued flood insurance isn’t expensive for homes outside the 100-year flood plain.
For about $400, according to the Insurance Council of Texas, you can get insurance on your home and contents, including furniture, clothing and some appliances such as washers and dryers.
If you’re wavering about whether it’s really necessary, consider this: About three- quarters of the homes in Harris County that flooded during Hurricane Harvey were outside the 100-year flood plain.
And water can rise quickly with little warning.
During the Memorial Day weekend deluge of 2013 that killed three people in Bexar County, water swamped businesses and houses, dislodged hundreds of residents and submerged part of U.S. 281 for sev- eral days. The region was mired in a drought, but water rose so fast that it lifted a bus traveling along McCullough Avenue off its wheels. Residents of Mission and Espada roads had no idea a wall of water was headed their way, reaching chest-deep in some places by the time they were evacuated.
Staff writer Scott Huddleston contributed to this report.