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Hurricane survivors learned the hard way about keeping a home inventory

This is the first in a series of stories about how American homeowners recovered from four types of natural disasters and what they learned from the experience.

Homeowner: Mark O’Brien

Location: Pensacola, Florida

Disaster: Hurricane Ivan, 2004

Mark O’Brien was working as a columnist at the Pensacola News Journal when Hurricane Ivan hit the Florida coast in 2004. He and his wife, Barbara, shared an older two-bedroom beachfront condo on Escambia Bay in the Florida Panhandle. “We had a view of the bay – it was pretty sweet,” O’Brien says.

The day the hurricane hit, O’Brien was covering the unfolding disaster as a reporter. He knew he couldn’t go home, so he spent the night at a friend’s house further inland. The next morning, he went to check on the damage. On his way there, O’Brien passed debris, downed branches and broken windows. “I remember walking up and seeing our place, and it was trashed,” he says.

hurricane-ivanHe remembers being grateful for three things at the time: “My wife is strong, my kids are grown and I’ve got good insurance.”

Filing the claim was a huge hassle, O’Brien says. The outside of the building was covered by the condo association’s insurer, while the inside was covered by Citizens Property Insurance Corp., the nonprofit entity created by the state to sell insurance to homeowners in risky areas.

“The process was very slow because Citizens was overwhelmed with the huge number of claims,” O’Brien says.

The process was slowed even more because the couple didn’t have an inventory of all of their household possessions. It took them weeks to create a list from memory. But O’Brien says his wife developed a friendly relationship with Citizens representative, who gave her an after-hours number to call; that helped the claims process go more smoothly.

The O’Briens had to rent an apartment for six months, and they had only $6,000 in coverage for additional living expenses (ALE). ALE pays for a place to stay and related costs if you can’t live in your home after it’s been damaged in a disaster covered by your insurance.

“I thought, ‘Oh, 6,000 bucks, that’ll cover everything,’ but it goes pretty quickly,” O’Brien says. They managed to get by, but some of their neighbors weren’t so lucky. “Lots of people had it far, far worse, having to stay with relatives they didn’t much like or in hotels that weren’t that nice,” O’Brien says.

According to consumer advocacy group United Policyholders, ALE coverage can be tricky. Amy Bach, the group’s executive director, says some home insurance policies put a dollar limit on this coverage, some put a time limit on it, and some put both. She recommends calculating how much your house could be rented out for each month and multiplying that number by 24 to determine the minimum dollar amount you’d need.

The O’Briens finally received about $60,000 for the structure – a few thousand dollars less than they’d hoped for. They sold their damaged condo and bought a new place – this time, not on the beach.

Insurance lessons learned

1. Before disaster strikes, take video of all of your possessions, and keep receipts and serial numbers for big-ticket items, such as your TV and appliances. Store the records in a safe place to make filing a contents claim easier.

2. During the claims process, develop a good working relationship with representatives of your insurance company.