Covered for Catastrophe?

By Renae Merle
Washington Post Staff Writer
Saturday, January 12, 2008

During most of the six hours it took D.C. firefighters to extinguish a blaze that engulfed his condominium building, Paul Carabello huddled outside with his neighbors, clutching the things he had managed to save: his passport, Social Security card and cellphone.

But soon enough, Carabello was thinking about the things he had left behind: The television. Waterlogged wool carpet that he later decided smelled like "stinky ashtray water." And the books. Shelves and shelves of books on architecture, design and art that he had collected over 10 years.

"If I had realized we weren't going to get back in, I would have taken some of those," said Carabello, 37, the lobby ambassador at the Hay-Adams Hotel.

The four-alarm fire in October at Carabello's Adams Morgan condo building, the Avalon, prompted an urgent question for its residents: How much will my insurance cover?

Victims of the Cherry Glen condominium fire in Beltsville confronted the same question last month. It's a concern for all homeowners and renters who face misfortune, be it a flood, a fire, a leaky pipe, an overflowing tub or a pesky dog that chews up the carpet.

While mortgage lenders require that single-family houses and condominiums have basic insurance coverage to protect their investment, homeowners have many options for additional coverage to safeguard their personal property.

Misunderstandings about what is covered can leave owners unprotected. Renters who mistakenly rely on a landlord's policy for protection can also face losses.

Many Avalon residents, including Carabello, had homeowners insurance. Others didn't and are struggling, according to residents. The condo association's master insurance policy will pay for the rebuilding but not for the replacement of owners' personal property. And despite the destruction of their homes, owners must continue to pay their mortgages, monthly condo fees and property taxes.

Local fundraisers brought in $9,000 in donations, which went to temporarily offset the cost of monthly condo fees. Council member Jim Graham (D-Ward 1) is pushing legislation to temporarily forgive residents' property tax bills. But even with insurance and donations, displaced owners still expect to feel a pinch.

Most owners have an allotment from their insurance company to cover the cost of renting another apartment while the four-story building is rehabilitated, said Samiya Edwards, a consultant on African policy who lived on the building's fourth floor and heads the reconstruction committee.

"The problem we run into with a fire of our magnitude is it is very easy to max out on that. In the coming months, people, depending on their insurance policies, will have varying degrees of financial distress," Edwards said. Her committee's goal is to have the building's restoration completed by the end of the year, she said.

Edwards and her fiance are renting an apartment nearby but may have to dip into their savings before they can move back to the Avalon. "We will definitely be out of pocket . . . thousands of dollars," including the cost of replacing furniture and other items, she said. "You're never going to recoup all your costs after something like this."

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