Homeowners Are Probably Not Covered : Insurance: Policies exclude mudslides, official says. Victims may have to go to court to prove that the fire was to blame.

Homeowners who suffer mudslide damage may not be able to collect on their insurance unless they battle in court to prove that fire devastation was to blame, insurance industry representatives predicted Thursday.

“Mudslides are specifically excluded (from coverage) in homeowners’ policies,” said Patty Lombard, executive director of Western Insurance Information Service in Los Angeles.

Moreover, she said, the insurance industry does not even make mudslide coverage available at extra cost, in part because of the near impossibility of assessing the risk. Mudslide victims, she said, will face more difficulty than the homeowners who were burned out and have filed claims after the huge fire hit two weeks ago.

But Dan Callahan, a lawyer who represents policyholders, on Thursday argued that the damage sustained in mudslides should be an extension of the normal fire coverage that homeowners purchased.

“If the mudslide is occurring because the landscaping was burned away . . . there would be coverage under a homeowner’s policy even if there was an exclusion of liability for earth movement,” he said.

But Robert Blodgett, a spokesman for State Farm, said each case would have to be investigated to discover whether the “predominant cause of the loss” was the fire and not the rain or something else triggering the mudslide.

Another possibility, said Rita Kepner, spokeswoman for the Federal Emergency Management Agency, is that a homeowner could be covered for storm damage under federal flood insurance.

“If there is enough water in a mudslide, it is covered under flood insurance,” she said.

Since 1968, flood insurance underwritten by the federal government has been available to homeowners in participating communities, including Laguna Beach.

However, Don Bester, a Farmers Insurance agent in Laguna Beach, said that, except for some residents in flood-prone Laguna Canyon, he doesn’t know of any Laguna Beach homeowners who purchased flood insurance.

“When you are on the side of a hill, you don’t usually worry about a flood,” he said.

He doubts also that many canyon residents bought the extra coverage. “Everybody is very positive here,” he said. “They all think: ‘It is never going to happen to me.’ ”