Prepare Your House and Finances for a Natural Disaster

You may not be as prepared as you think.

When a storm is bearing down or a wildfire or tornado is approaching, you don’t want to be thinking about all the things you should have done to protect your family, house and finances.

So with wildfires raging in parts of the West, and hurricane season in full swing, taking some crucial steps in advance—especially if you live in a region prone to natural disasters—can help you minimize any damage.

“It’s imperative to make sure you are prepared,” says Thomas Kirsch, a member of the American Red Cross Scientific Advisory Council and co-director of the Center for Refugee and Disaster Response at Johns Hopkins University. “Get things ready to go,” he says, with a disaster kit “and the appropriate financial stuff available to you.”

1. Make a Plan

Create an emergency plan, detailing where you and family members would meet up after a disaster and how you’d stay in touch. Also designate an out-of-state contact whom people can call if they’re unable to get to the meeting spot.

Next, put together a disaster kit and store it in a place all family members can easily access. The disaster kit should include nonperishable food items and water for your family to last 72 hours, a first-aid kit, a flashlight and batteries. Also be sure to keep some cash on hand in case you can’t access a bank or ATM., which is run by the Federal Emergency Management Agency, and offer tips and information on creating a disaster plan and kit.


2. Make Sure You’re Covered

The most important financial consideration before any disaster is to find out what your home owners insurance does and doesn’t cover—and whether you need to buy supplemental coverage.

Some policies cover replacement cost, meaning the cost to replace your items, while others cover actual cash value, which is replacement cost minus depreciation, says Jeanne Salvatore, a spokeswoman at the Insurance Information Institute.

Roman Suarez, a market claim manager of Allstate’s National Catastrophe Team, recommends taking photos or video of the contents of every room. It’s also a good idea to keep receipts for valuable items.

Most home owners policies exclude flood coverage. So if you live near water or in a flood zone, consider getting flood insurance. If you have a federally backed mortgage in a Special Flood Hazard Area, flood insurance is a requirement. Other lenders may require it as well.

The majority of flood policies are offered through the National Flood Insurance Program. The average policy runs about $600 a year, according to FEMA, but prices vary depending on the house and an area’s risk.

It typically takes 30 days before a flood policy goes into effect, and coverage is capped at $250,000 for a home’s structure and $100,000 for contents. If you want additional coverage, you can often buy supplemental flood insurance from a private firm.

The flood-insurance program pays out lots of claims to people outside of special hazard areas, says FEMA administrator Craig Fugate. On the program’s site,, you can plug in your address to see whether you live in a high-risk area and get premium estimates. The site also has information about insurance agents in your area.

Damage from earthquakes is often excluded from home owners policies, but you can purchase a separate policy that covers quakes. An average home quake policy offered by the California Earthquake Authority costs $770 annually, says Chief Executive Glenn Pomeroy.

If you live in a rental, damage to the property itself will be the responsibility of the landlord. But you will be responsible for the replacement of your belongings—from televisions to furniture to clothing.

And renters insurance is often relatively cheap. For instance, a renters policy for the New York area, offered by State Farm, starts at $125 a year for $20,000 in coverage.

3. Store Your Documents

Pedro Correa of Staten Island, N.Y., put documents, jewelry and a list of his home’s valuable contents, along with a video documenting them, in a safe in his master bedroom. But when Mr. Correa’s house was swept away last October during Hurricane Sandy, the safe was gone.

“We have an apartment now and I have a detailed list of everything I own now, but it’s in a safety-deposit box,” says the 37-year-old corrections sergeant.


Items that should be kept in a safe-deposit box or other secure location include: house deeds or rental leases, a list of insurance policies and the policy numbers, bank documents, birth and marriage certificates, passports, copies of drivers licenses, stock and bond certificates, powers of attorney and wills, as well as valuable jewelry.

You also should make digital copies of these documents (and family photos) and use a service like Dropbox, Microsoft’s SkyDrive or Google GOOG +0.03%Drive to put them on the cloud, a network of servers that lets you access your data from any computer.

4. Prepare Your Home

How you prepare and protect your house and property will, of course, depend on the disaster you are most at risk to experience.

In areas prone to wildfires, you should create a “defensible space” around your house by trimming trees and brush and clearing dead vegetation. You can reduce your roof’s vulnerability to fire by removing debris from the gutters on a regular basis. If you’re thinking of replacing the roof, keep in mind that materials such as tile, metal and slate are much safer than asphalt and wood.

For homes where tornados occur, it’s important to build a safe room that can withstand destructive winds and flying debris.

In earthquake zones, go through the house and secure vulnerable objects (say, bookcases or grandfather clocks) to the walls.

Depending on how old your house is, you may want to consider building shear walls under the first floor, which will absorb the quake force and transfer it to the ground, says Howard Cook, co-owner of Bay Area Retrofit in Albany, Calif. Mr. Cook says such a project typically costs around $6,000.

In hurricane areas, FEMA recommends buying a generator, covering a home’s windows and making sure your sump pump works. Greg Nelson, a contractor in Tampa, suggests having plywood panels made to fit all your windows so you can easily slip them on.

Regardless of where you live, consider hiring a home inspector see what parts of your home may be vulnerable. Bill Jacques, president of the American Society of Home Inspectors, says an inspection typically runs around $300 to $400.


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