May 11, 2011 6:50 PM by Danielle Lerner

Breaking down disaster insurance, are you covered?

If a major earthquake or flood hit the Central Coast would your home be protected? What about in a tsunami or nuclear disaster?

Standard homeowner's insurance policies do not cover those types of events and that could mean major financial losses should disaster strike.

From a deadly earthquake, to widespread flooding and threats of a tsunami, the Central Coast has certainly felt the wrath of mother nature. So when the next natural disaster hits, will you and your home be ready?

"I do believe that people don't realize that their home insurance, renter's, condominium's insurance policies do not cover earthquake or flood insurance," said Matt Neff, a local insurance agent.

Neff says the earthquake and tsunami in Japan have many local homeowners looking to up their insurance coverage, just in case.

"We saw quite the surge in requests for earthquakes,inquiries for flood insurance," Neff said.

People living on Security Court in Oceano know the importance of being prepared. Back in December, heavy rain forced the nearby pond to overflow, sending several inches of water into surrounding neighborhoods.

It cost Judy Sorensen nearly $40,000 to repair her Oceano home.

"We cut out the wall board about two feet and that all got replaced," she said. "The water would just like push its way into the house."

Sorensen's flood insurance policy covered the structure only, not the contents, but it still paid $20,400 for the repairs.

"We would have been starting from square one and we don't have $40,000 to fix the house," she said.

Flood insurance also covers damage from a tsunami and it is required to refinance your home or get a mortgage. The annual premiums vary depending on where you live and how much coverage you want. The FEMA-backed National Flood Insurance Program can help you protect your home, and the contents inside, for as low as $129 a year. The federal government sets flood insurance rates so they won't vary from carrier to carrier.

Not every company provides flood insurance, but the NFIP web site can help you find providers in your area and give you an idea of how much a policy will cost.

Earthquake insurance, on the other hand, can be more expensive and the rates do differ among carriers. The California Earthquake Authority works with participating insurance companies to provide basic coverage at lower premiums. The more comprehensive policies can cost anywhere from $200 to $2,000 a year, depending on where you live and what you want covered.

"That's where the agent will help shop that out, search that out and take a look at those necessities," said Neff.

Then there is the possibility of a nuclear disaster. Living so close to Diablo Canyon, we wanted to know if there is a way to protect you from a major financial loss in the event of a disaster.

"Nuclear is just something that's excluded in every single insurance policy," Neff said.

After a nuclear disaster, victims would receive financial assistance under the Price-Anderson Act. The owners of nuclear power plants pay hundreds of millions of dollars in insurance premiums every year, so that insurance pool would cover bodily injuries, sickness, property damage and loss, as well as living expenses for people evacuated.

They are scenarios we hope never become reality, but the question remains, will you and your home be ready should disaster strike?

"Most people, they don't want to pay the insurance premiums until that catastrophic situation happens and then they're very thankful that they have it," Neff said.

At the very least, local insurance agents recommend reviewing your homeowner's insurance policy at least every two years, so you know exactly what is covered and what is not.

For more information on how to get disaster insurance just head to the Newslinks section of ksby.com.


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