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They are good neighbors who keep you in good hands, but when it comes to covering Hurricane Katrina losses their news may be bad.

"There are a large number of policies or claims that have already been denied by the major carriers on the grounds that the damage was almost exclusively caused by tidal surge rather than wind," said attorney Lance Stevens, who is chairing an ad hoc insurance committee set up by the Mississippi Trial Lawyers Association.

"It became clear to us after Day One that this was going to be a huge economic issue in Mississippi and that people were going to be (financially) destroyed.

"I think it is essential that people on the Coast and their friends statewide ratchet up the political pressure to make the insurance companies do the right thing."

Homeowners' policies exclude water damage, here and in other states, said Mississippi Insurance Commissioner George Dale. Dale said he is requiring insurance companies to prove water rather than wind caused damage before denying an insurance claim.

Nationwide Insurance Co. is assessing claims case by case, said corporate spokesman Joe Case.

"There's not any line being drawn," Case said. "Each case is unique and our claims adjusters will look at the circumstances."

If water damaged a house because of a hole in the roof, he said the loss would be covered. But when water comes from the ground, even in the case of tidal surge, losses are not covered under a standard homeowner's or hurricane policy.

Instead, a homeowner must have flood insurance. In July, only 21,593 flood insurance policies had been written in the three Coast counties, said Ed Pasterick, a senior advisor with the National Flood Insurance Program.

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