Ron C. Henderson and Ron Camarota of the Louisiana Department of Insurance’s Office of Consumer Advocacy join Discover Lafayette to speak on the ins and outs of home insurance policies, figuring out how to get adequate coverage, and what your rights are as a consumer, especially after a storm. With hurricane system here, this is an important topic.

Knowing what your home insurance policy covers is critical to understanding your rights after a storm or catastrophic damage occurs. The Louisiana Department of Insurance is on a mission to educate consumers before they experience the heartbreak of being inadequately insured in the wake of a disaster.

In Louisiana, flood damage is a common occurrence as 57 of our 64 parishes experience flooding. However, since 1964 in the U. S., flood damage coverage has been excluded from standard homeowner's insurance policies; it must be purchased separately under a policy underwritten by FEMA. This is the only insurance resort available to homeowners under Congress's National Flood Insurance Program. Many a homeowner policyholder has been devastated to learn they have no insurance coverage after a flood.

Flood insurance covers water damage "from the ground up." That is, it kicks in when a storm causes water to enter your home from the ground level. Traditional homeowners/commercial policies will cover damage from "top-down" water damage that occurs.

Your deductible can drastically affect the cost of your premium. Ron Henderson gave an example of his father who had maintained a $50 deductible for decades and wondered why his rates were so high. Once he determined he could afford a $10,000 deductible, his premiums were reduced accordingly.

The Louisiana Department has an online rate-shopping tool to help you compare insurance rates among companies to get the best rate for your individual needs. Visit https://www.ldi.la.gov/online-services/shop-your-rates/homeowners-comparison-guide.

When speaking with insurance agents, be prepared to ask the right questions. Always ask for alternatives to what is quoted. "Can I get a better option? Can I get a static fee deductible or do I have to go with a percentage of the hurricane damage? What is excluded from coverage? What is the Additional Living Expense allowance under the policy in the event I am displaced? Is this covering Actual Cash Value or Replacement Cost of damaged property? Is mold covered?"

A storm deductible typically ranges anywhere from 2%-5% of a home’s total insured value - so if a home is insured for $200,000 and has a 5% deductible, the first $10,000 in repairs must be paid out of pocket by the policyholder. If you can negotiate a lower deductible for these occurrences, it may well be worth it.

Both guests stressed the importance of reading your insurance policy. Familiarize yourself with the sections and what each cover. Insurance policy language is effective for one year at a time and changes are reflected in each one-year renewal period, perhaps causing you to experience changes in contractual terms that you may not desire. Most consumers never take the time to read their policy and are shocked when confronted with a damage claim that is not reimbursable or not reimbursed at the level needed to get back on their feet. It is critical to be proactive in understanding what your policy covers and take steps to add coverage if it is not initially offered. You can always purchase an endorsement or rider to expand existing coverage on things such as antique furniture, jewelry and other valuables. Keep up with the value of your home as it may be prudent to raise your coverage as real estate prices inflate.

Ron Henderson says "You get what you pay for." Not meaning that the insurance company doesn't want...