A year after Hurricane Katrina flattened her ranch-style brick house on Washington Avenue here, Tina Lee has received only $2,500 from her homeowner's policy for living expenses. Her four-bedroom home, a block away from the beach, sustained nearly $300,000 in damage, but her insurer said the property was destroyed by flooding, not wind. The distinction is important: A standard homeowner's policy pays for damage from a hurricane's winds and rains, but it doesn't cover flooding. "They're saying that the top of (my neighbor's) house floated over here and landed on my house," says Lee, 44, who is living in a one-bedroom RV. But, "We had over 100-mile-per-hour winds before the water even got here." Her neighbor whose house crushed hers just happened to be Richard Scruggs, the Mississippi lawyer who took on the tobacco and asbestos industries.