GALVESTON — Many Galveston property owners forced to demolish their houses or commerical buildings because of hurricane damage will not get enough money from the National Flood Insurance Program to pay off their mortgages.

The federally backed program, which holds 16,161 policies on the island, will only pay for damage inflicted by the storm.

Even if the city determines a structure is substantially damaged and must be torn down, the flood insurance program may not pay the full value of the policy.

“Payment of the policy has nothing to do with the damage determination by the local community,” said Carl Watts, of the Federal Emergency Management Agency.

A property owner with a $100,000 insurance policy, for example, would only get $60,000, if that’s what the insurance adjuster determines repairs to the structure would cost.

If the city requires that same property owner to demolish and rebuild because the repairs cost more than 50 percent of the structure’s value, the owner will not get any more insurance money.

If the insurance payout does not cover the full value of the property’s mortgage, owners will be required by their lenders to continue making monthly payments.

Property owners can get up to $30,000 to pay for the cost of demolition and elevation of a new structure, if their insurance policies include an increased cost of compliance clause.

Owners who need financial assistance to rebuild can apply for a low-interest loan from the Small Business Administration, which has already approved more than $6 million in loans for island residents and business owners.

The city could also offer help through the federal government’s Hazard Mitigation Grant Program.

City officials could use the grant funds to buy substantially damaged property and convert the land into public open space and to help elevate flood-prone structures.

The city must request the program through the state. If the request is approved, the federal government would give the money to the state, which would distribute it to local governments.