This is the fourth time in recent months that the program has been allowed to lapse. The hiatus means that the NFIP is not authorized to sell new policies, issue increased coverage on existing policies, or issue renewal policies.

However, NFIP policies that are in force will remain in force and claims under those policies can continue to be paid after May 31.

Allowing the NFIP to lapse at the start of the 2010 hurricane season is irresponsible, according to the National Association of Mutual Insurance Companies (NAMIC). In a press release, NAMIC federal affairs director Kathy Mitchell said:

Millions of homeowners and businesses will be left vulnerable to storm losses because of Congress’ failure to act as one of the worst possible times…Given the forecast for this summer’s storm season, it is unfortunate that Congress would fail to act on this issue and put millions of Americans’ financial security at risk.”

It’s worth noting that it was the widespread flooding associated with Hurricane Katrina in 2005 that put a spotlight on the NFIP and started the debate about how to improve it. Five years later, that debate continues.

After its last hiatus the NFIP was granted a temporary extension until May 31. That renewal was retroactive to March 28, covering the more than two-week period when Congressional inaction allowed the program to lapse.

On the FEMA Web site, the agency says the hiatus period is expected to end soon. FEMA has issued guidance including a set of Frequently Asked Questions concerning NFIP authorization to help insurers participating in the program to communicate with insurance agents and policyholders. Check out I.I.I. information on flood insurance.

So what if you don’t live in the home and either rent it out as an investment, or consider it a vacation home 3 months out of the year? Let’s start with the first one- investment property. Any investment property that you rent out should only require coverage for the dwelling and liability. A dwelling policy fits this situation perfectly because you don’t need to insure your personal property since it is not located at this building. However, if you have some personal items at the property you can add additional coverage to a dwelling policy to cover it, but for the most part a dwelling policy provides insurance for the building itself and if available- liability. The bottom line is with a standard dwelling policy you are only paying for coverage you need. If additional insurance is necessary beyond the dwelling itself, such as liability or even a small amount of personal property coverage you can add it to the dwelling policy.

1. Coverage for the structure of your home.
2. Coverage for your personal belongings.
3. Liability protection.
4. Additional living expenses in the event you are temporarily unable to live in your home because of a fire or other insured disaster.

1. The structure of your house

This part of your policy pays to repair or rebuild your home if it is damaged or destroyed by fire, hurricane, hail, lightning or other disaster listed in your policy. It will not pay for damage caused by a flood, earthquake or routine wear and tear. When purchasing coverage for the structure of your home, it is important to buy enough to rebuild your home.

Most standard policies also cover structures that are detached from your home such as a garage, tool shed or gazebo. Generally, these structures are covered for about 10% of the amount of insurance you have on the structure of your home. If you need more coverage, talk to your insurance agent about purchasing more insurance.

2. Your personal belongings

Your furniture, clothes, sports equipment and other personal items are covered if they are stolen or destroyed by fire, hurricane or other insured disaster. Most companies provide coverage for 50% to 70% of the amount of insurance you have on the structure of your home. So if you have $100,000 worth of insurance on the structure of your home, you would have between $50,000 to $70,000 worth of coverage for your belongings. The best way to determine if this is enough coverage is to conduct a home inventory.

This part of your policy includes off-premises coverage. This means that your belongings are covered anywhere in the world, unless you have decided against off-premises coverage. Some companies limit the amount to 10% of the amount of insurance you have for your possessions. You have up to $500 of coverage for unauthorized use of your credit cards.

Expensive items like jewelry, furs and silverware are covered, but there are usually dollar limits if they are stolen. Generally, you are covered for between $1,000 to $2,000 for all of your jewelry and furs. To insure these items to their full value, purchase a special personal property endorsement or floater and insure the item for it’s appraised value. Coverage includes “accidental disappearance,” meaning coverage if you simply lose that item. And there is no deductible.

Trees, plants and shrubs are also covered under standard homeowners insurance. Generally you are covered for 5% of the insurance on the house—up to about $500 per item. Perils covered are theft, fire, lightning, explosion, vandalism, riot and even falling aircraft. They are not covered for damage by wind or disease.

3. Liability protection

Liability covers you against lawsuits for bodily injury or property damage that you or family members cause to other people. It also pays for damage caused by your pets. So, if your son, daughter or dog accidentally ruins your neighbor’s expensive rug, you are covered. However, if they destroy your rug, you are not covered.

The liability portion of your policy pays for both the cost of defending you in court and any court awards—up to the limit of your policy. You are also covered not just in your home, but anywhere in the world.

Liability limits generally start at about $100,000. However, experts recommend that you purchase at least $300,000 worth of protection. Some people feel more comfortable with even more coverage. You can purchase an umbrella or excess liability policy which provides broader coverage, including claims against you for libel and slander, as well as higher liability limits. Generally, umbrella policies cost between $200 to $350 for $1 million of additional liability protection.

Your policy also provides no-fault medical coverage. In the event a friend or neighbor is injured in your home, he or she can simply submit medical bills to your insurance company. This way, expenses are paid without a liability claim being filed against you. You can generally get $1,000 to $5,000 worth of this coverage. It does not, however, pay the medical bills for your family or your pet.

4. Additional living expenses

This pays the additional costs of living away from home if you can’t live there due to damage from a fire, storm or other insured disaster. It covers hotel bills, restaurant meals and other living expenses incurred while your home is being rebuilt. Coverage for additional living expenses differs from company to company. Many policies provide coverage for about 20% of the insurance on your house. You can increase this coverage, however, for an additional premium. Some companies sell a policy that provides an unlimited amount of loss-of-use coverage, but for a limited amount of time.

If you rent out part of your house, this coverage also reimburses you for the rent that you would have collected from your tenant if your home had not been destroyed.