Forecast for Insurance Claims Is Bit Iffy : Liability: Adjusters have brisk day as homeowners report weather damage. But will losses be covered?

Monday was a brisk day for insurance firms around Orange County as scores of homeowners called to report damage from the fierce storms that lashed the region.

At the insurance office of Cal Shores in Lake Forest, a few policy holders phoned to relate how their houses were hit by the twister that danced across the community with the aplomb of a freight train.

Over in Laguna Beach, insurance specialists began dealing with the aftermath of a neighborhood calamity as a trio of houses slid down a rain-slick hillside and one burst into flames.

Insurance agent Jim Berg, meanwhile, has been handling far more mundane claims. Since a phalanx of storms began parading across Southern California about a month ago, Berg has received scores of calls from homeowners reporting leaky roofs and other rain-related problems.

Whether the claims are covered, of course, is another story.

Wind damage is typically an insurance slam dunk for a homeowner. Whether it’s a fence knocked down or a whole roof ripped off, an insurance company almost always will cover the damage, Berg and other experts say.

Problems like water damage can be more ticklish. Most homeowners do not carry flood insurance, so a sudden surge of water into the front door and out the back from a clogged neighborhood storm drain typically doesn’t qualify. The same goes for, say, an old roof that allows water to begin cascading down onto a prized Oriental carpet.

But if the roof was damaged during a storm (maybe a few shingles flew off or a neighborhood tree came crashing down), leaks very well might be covered under a standard homeowners policy.

“If the roof is damaged in a wind storm, then the resulting water damage is covered as well as damage to the roof,” Berg said. “But if the roof simply leaks because of normal wear and tear, that’s not covered.”

The insurance prospects for the unfortunate homeowners in Laguna Beach are decidedly more murky. Insurance officials say most policies don’t handle so-called “subsidence” problems when homes scoot off a foundation and into the abyss.

But there’s hope for the one homeowner whose house burst into flames.

“That’s going to be an interesting claim,” Berg said. “Fire or explosion is covered. But landslide or land slippage is not covered. So it’s going to be interesting to see what they’ll pay under or if they’ll pay at all.”

There may be a precedent. If a home catches fire after an earthquake, insurance carriers often fork over money for any damage caused by the flames. That same sort of scenario could apply in the Laguna Beach situation.

“When you have an unusual event that occurs, you might have situations that don’t fit the typical norm, and those have to be handled on a case-by-case basis,” said Jeanine Raquet, regional underwriting manager for Allstate Insurance.

Even if the unlucky residents can’t tap insurance dollars, Gov. Pete Wilson might gallop to the rescue. Wilson is expected to declare a state of emergency today in Orange County, giving homeowners the opportunity to tap a low-cost loan program to rebuild or make repairs.

Shores, meanwhile, noted one near certainty with the predicament in Laguna Beach: “You know the way the insurance industry is today, attorneys are going to be involved automatically,” he said.