Covered for Catastrophe?

Jenn French, another fourth-floor resident, said that she expects her insurance to cover up to 13 months of rent and to replace many of her lost belongings but that she knows it will not cover everything. "I still think of something every day that I left off my list," said French, the owner of a graphics design company.

Deciding how much insurance is enough to protect your home can be daunting. A student renting a first apartment, for example, may have a hard time putting a value on a hodgepodge of cheap furniture, books and music.

Insurers recommend that homeowners keep a running tally of their property, including any special items, such as heirlooms or expensive jewelry, that may require additional coverage. Renters considering whether to get coverage should think about the value of not only furniture but also electronic equipment, including iPods, laptops and computer games.

"Renters need to realize that, yes, the landlord does have insurance, but it is to protect their interests, not yours," said Carolyn Gorman, vice president of the Insurance Information Institute, an industry trade group.

The landlord's policy, for example, will not cover a renter's personal property or protect him or her from personal liability if there is an accident in the unit, Gorman said. "Suppose you were frying some chicken in your kitchen and caused a grease fire, and it causes massive damage," Gorman said. "The landlord could sue you for that."

For owners of single-family homes , deciphering what is covered on the standard policy can be confusing. Mortgage lenders require owners to have enough insurance to cover the cost of rebuilding the home. But in a recent study, the National Association of Insurance Commissioners found widespread misunderstanding about what else the policies cover.

For example, standard policies cover damage from fire, lightning, hail or theft, but not floods or earthquakes. Insurance against flood damage, for example, is provided by the National Flood Insurance Program. This issue often emerges after disasters such as hurricanes, when surprised homeowners find themselves without enough coverage.

The need for separate flood and earthquake insurance is just the start of the issues homeowners seem misinformed about, said Cathy Weatherford, chief executive of the National Association of Insurance Commissioners. "A pretty high percentage thought their pets would be covered under [their] homeowners policy if they were stolen or injured," Weatherford said. They're not.

Condominium owners are sometimes equally perplexed about what is covered under their policies. Condos are required to have insurance, known as a master policy, to pay for the building's reconstruction in the event of a fire, accident or disaster. But owners' personal property would be covered under separate homeowners policies, which are not required. Generally, the master policy covers the physical building and each unit owner's walls, floors and ceiling. Some policies also include standard fixtures such as kitchen cabinets, major appliances and bathroom fixtures, according to insurance experts.

Master policies can be extended to protect a condominium association from theft. Last year the Virginia Real Estate Board filed a complaint against local property manager Koger Management Group, alleging that large cash withdrawals had been made without documentation from numerous homeowners associations. A Fairfax County Circuit Court judge placed the firm under court supervision; it has since changed name and ownership. The successor firm referred questions to former management, which did not respond to requests for comment.

"I can tell you that we have paid some claims to some communities who were managed by Koger and whose funds were missing," said John Manougian, president of John Manougian Insurance Agency in Silver Spring. The buildings had "fidelity" coverage, which protected them from "dishonest acts," he said.

But some owners confuse the master policy maintained by the condominium association with personal homeowners insurance that would protect their belongings. "They wrongly assume [the master policy] covers more than it does. That is why some are left with very little after a significant fire," Manougian said. Many new condo communities now require their owners to have homeowners insurance, while older communities may not, he said.