A quick-thinking grandmother hoisted her daughter and newborn granddaughter into the roof of her house to save them from an "inland tsunami", an inquest has heard.

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Margaret 'Anne' Smith had been having tea and coffee on her front veranda as waves of canola- riddled water devastated Eugowra on November 14, 2022.

Ms Smith gave evidence during day two (October 14) of an inquest into the deaths of Diane Smith, 60, and Ljubisa 'Les' Vugec, 85, who drowned during the disaster.

After waking to an emergency siren at 3am, Ms Smith had a feeling certain

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