The most recent fires in California are taking an increase toll on the state and its population. After a year and a half of significant losses due to ravaging wildfires in various parts of the state, California homeowners living in the vicinity of these blazes now face the prospect of losing their insurance.
Throughout 2017, wildfires in the state caused numerous burn and smoke inhalation injuries as well as nearly $12 billion in damages – the costliest financial toll resulting from fires in the state’s history. Now, in 2018, new conflagrations in CA are continuing the losses.
Governor Jerry Brown describes it as, “the new normal that we have to face.”
At present, 18 large wildfires are rolling through the state. In Northern California, the Carr fire has been burning since late July and has already resulted in seven fatalities with less than 50% of the fire contained. The Mendocino Complex fire has destroyed more land than any other fire in the state’s history – over 283,000 acres. More than two-thirds of this fire is not yet under control.
Now, homeowners’ insurance companies are choosing not to renew certain policies: not just for properties damaged by previous (and current) fires, but also for those located in high-risk zones. Companies such as Liberty Mutual claim to be following their standard underwriting guidelines in making these decisions. As such, it is difficult for the homeowners involved to do anything about these nonrenewal decisions. However, insurers must provide an objective evaluation of a property’s risk and follow the established guidelines consistently to every property under evaluation. If this is not done properly, the homeowner may have a claim against the insurer.
When an insurer drops your homeowner’s coverage
If you live in a high-risk zone and your insurer has sent you a nonrenewal notice about your policy, the law provides you with 45 days to obtain replacement coverage. One insurer will not necessarily use the same risk profiles and standards as another. Therefore, you may be able to obtain insurance from another provider even if you have been dropped.
However, if your home is in a high-risk zone, any coverage you may obtain will likely cost more than the premium that you previously paid.
As with any services from a contractor, it’s important to obtain quotes from multiple insurers in your area. Since you only have 45 days to find new coverage, it’s important to start immediately researching insurers in obtaining quotes.
The California FAIR Plan may help you if your policy has already expired or is close to expiring and you have been unable to obtain coverage thus far. This plan offers insurance to homeowners of high risk properties. It only provides basic coverage. You will need supplemental insurance to access benefits such as liability protection.
We want you to be safe. “Stuff” can be replaced; you cannot. If you are in a high-risk zone, we urge you to seek shelter elsewhere until you are cleared to go home. And if you are facing an uphill battle with the insurance companies, give us a call. We can help.