Charles and Laura LePage spent more than 50 years perfecting their Lower Ninth Ward home, buying carpets and silk draperies to accent their marble-top furniture and hardwood floors, crystal chandeliers and porcelain lamps. Their garden was awash in colorful bushes and flowers.

Despite the near-total devastation, the LePages want to rebuild and start over. But they are finding that the second wave of Hurricane Katrina's wrath is dealing with the insurance company.

"Nobody has gotten anything," LePage said as he watched workers carry out once-beloved items from his home. "We're totally dissatisfied with the progress on the insurance. Anything to keep from paying."

Nearly three months since Katrina drowned New Orleans and other Gulf Coast communities, frustrations are mounting for residents whose homes and possessions were laid waste by the storm.

Like the LePages, most want to get on with their lives, but they've had difficulty reaching anything more than a recording at their insurance companies. They've had trouble getting meetings with adjusters, and they've yet to see money paid out on claims.

"Here we are still waiting," said LePage's daughter Laura Ann, whose New Orleans East home was flooded with about 3 feet of water. "You can't do anything. You're just on hold, really."

Plaintiff's lawyer Richard "Dickie" Scruggs, one of the architects of the successful $246 billion lawsuit against the tobacco industry, says the delays are no accident. Insurers are practicing a technique known as "slow rolling," procrastinating in making payments in hopes that claimants grow tired, desolate and more likely to accept what is offered.

"They do this limbo thing. Let it cool down, let these people get desperate. These people have no jobs, no insurance," said Scruggs, who is fighting his own battle with insurers over the loss of his Mississippi home to Katrina. "The insurance companies vacillate on making any commitment at all, hoping it'll all die down and the news channel will change subjects. This isn't their first rodeo."

Private insurers say they are working as quickly as possible and that they're stretched beyond capacity by the size of Katrina's devastation, expected to become the costliest in U.S. history with estimated losses of up to $90 billion.

The insurance industry - warning that premiums nationwide probably will increase because of the storm - says it has dispatched more than 15,000 adjusters to handle the expected 2 million claims from the Gulf Coast region.

Flood insurance is bought separately under a government-run program, but many people who lost their homes to Katrina believe that their private homeowner's policies should cover them.

"Flood damage is, typically, not covered by a homeowner's insurance policy," said Jerry Johns, president of Southwestern Insurance Information Service in Austin, Texas, which represents property-casualty insurance companies.

"Some consumers in the region affected by Katrina are disputing this long-standing fact," he said. "Insurers feel they are doing their job, but when coverage does not exist, it would be irresponsible for them to pay a claim, which is totally unjustified."

For decades, the typical homeowner's insurance policy has stated: "We do not insure for loss caused directly or indirectly by any of the following: such loss is excluded regardless of any other cause or event contributing concurrently or in any sequence to the loss. Water damage, meaning flood, surface water, waves, tidal water, overflow of a body of water or spray from any of these whether or not driven by wind."

But homeowners in some Gulf Coast states, Scruggs notes, are required to pay for hurricane coverage as part of their insurance. Under that coverage, a hurricane is defined as wind-driven water, known as a "storm surge."

"What you're looking at from the same insurance company is two definitions of flood in a hurricane," said Scruggs, whose insurer refuses to pay for damage on his Pascagoula beachfront home, which was swept from its foundation by a 25-foot storm surge. His insurer, says Scruggs, contends he was flooded and, therefore, his homeowner's insurance policy doesn't apply.

"I want to encourage the people to continue to fight and I'll do everything I can to make sure that insurance companies pay what they owe," said Mississippi's Attorney General Jim Hood.

Lawsuits are also being prepared in Louisiana, where the state Department of Insurance has had about a thousand formal consumer complaints involving post-Katrina insurance issues.

Robert Hartwig of the Insurance Information Institute, a trade group, told a recent Senate hearing that the lawsuits "spread false hope among desperate people that clever lawyering can produce flood coverage where none, in fact, exists."

It is not clear how many of the millions of expected insurance claims have been settled, said Johns. "Various insurance departments will be collecting this information in the future."

"FEMA doesn't regulate, we don't track, we don't pay attention to standard homeowner's insurance," said spokesman Butch Kinerney. "Private insurance is outside our scope."

FEMA does oversee the government-run National Flood Insurance Program, and so far only about 5,000 of the 225,000 possible claims have been settled for both Hurricane Katrina and Hurricane Rita.

Flood claims are usually handled first because they're backed by taxpayer money and don't cost the insurance industry. In fact, individual insurance companies get paid each time a flood settlement is completed, so it actually earns them money.

"They're more than willing to pay that because it doesn't cost them anything," Scruggs said. "Since only 10 percent of residents on the coast had flood insurance, they're willing to pay. In addition, they're going to try to use that as evidence that you agreed that it was a flood."

"A monthlong delay in claims for 50 destroyed homes could bring in more than $30,000 in investment income to the underwriter," he said. Also, the "longer the delay, the more likely homeowners will settle for less."

"You realize we're involved in a lawsuit?" said Jim Jenkins, executive vice president of Mississippi Farm Bureau Mutual Insurance, a not-for-profit company that insures about 240,000. "I just don't think I'll say anything because it can be held against me."

New Orleans Mayor Ray Nagin recently heard a litany of complaints at a town hall meeting in Baton Rouge, La., from some 1,500 displaced residents upset that insurers are refusing to pay claims, are slow in sending adjusters and are forcing policyholders to endure multiple adjuster visits.

One woman recounted spending an entire week on the phone trying to handle her insurance only to learn that the claim had been passed to another company for processing. After an adjuster came and examined her damaged home, she got a call announcing that still another company was being sent her claim and she'd have to meet with another adjuster.

"I have children who want to go home. I have a senior who wants to go home," said the woman, who identified herself as a social worker. "How much of the runaround, Mr. Mayor, do we deal with?"

Adjusters, meanwhile, are walking a tightrope, doing a job that's unlikely to make anyone happy. Policyholders want to be paid the maximum allowed; insurance companies say they can't pay more than required.

"They told us during our orientation not to talk to the press," said an Encompass Insurance adjuster from Chicago, who was checking out claims in New Orleans.

"I think they were told not to talk to the clients too," said Paula Spearman, who owns three rental properties insured for a total of $400,000 and located in different New Orleans neighborhoods. Wind or floodwaters damaged all of the homes.

"I finally got an emergency check for $2,040 after four and a half weeks," she said as she watched an adjuster go through her now-uninhabitable property in the Holy Cross neighborhood of the Lower Ninth Ward, east of downtown New Orleans.

"They give out a million 800 numbers you have to call. You get at least 15 automated answers before you get disconnected. This is ridiculous. I try to be patient, but it's very difficult. Everything is wait, wait, wait, wait, wait."

Terry Fredericks, who lives in the Ninth Ward, said he has received no money for any of his four houses damaged by Katrina, but he already has a brand new truck sitting in his driveway.

Jason Gruczyky, an adjuster with Progressive Insurance, which covers vehicles and boats, says his customers are grateful because they get a check the same day they file their claim. But he's hearing a lot of frustration anyway.

"People say, `I wish my home insurance was as easy as my auto insurance.' We're hearing that from more than half of the people we talk with," he said.

Gus Ramirez, who lost his home near Lake Pontchartrain and everything in it, had purchased separate flood insurance as a requirement of his mortgage because his house was in a designated flood zone.

"I don't put a lot of faith in insurance," he said, surveying the rotting furniture pulled from his home. "They can pretty much make up the rules how they want."

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