Santa Rosa, California can be a number of remarkable things. The huge forest fire that consumed human lives and property in October 2017 will go down in history as a tragedy of unprecedented damage. With forty-three victims dead and more than $1 billion in property devastation, totaling more than $1 billion in losses, the fire left policyholders dealing with the painful aftereffects.
Then there are the regrets in underlining insurance concepts. Too many homeowners and commercial property owners failed to prepare for the worst by purchasing the right coverage.
What points can we get from the event? Insurance professionals share the following urgent notes.
Eight California Catastrophic Wildfire Insurance Concepts
• Many policyholders had insufficient coverage for colossal damage. While it is human nature to imagine that bad things only happen to others, those who suffered enormous losses from the fire would have made a full recovery possible with better insurance protection.
• Those who dealt with independent insurance companies and agencies that excelled in supporting claims fared better than others who received misinformation regarding their policy coverage.
• The use of debris removal from the Federal Emergency Management Agency was the preferred option over other services from private companies. This is because the owners could change after utility selection if they wanted to.
• Those who had loss of use or living expenses coverage benefited greatly after the wildfire.
• Homeowners who purchased extended replacement cost coverage are allowed to completely rebuild with insurance proceeds.
• Contrary to the belief of some, there is landscaping coverage in a standard homeowners insurance policy. This gives leeway to those who must replace trees and brush lost in the fire.
• In view of the tragic fire, the contents insurance was modified. This led to many insurers agreeing to cover at least 50% of the home’s contents without the policyholder having to go through the laborious process of inventory categorization. Some insurance companies even consented to coverage of all content without the ratings. However, other companies waived the inventory process based on individual claim.
• Those who listed a second home on their homeowners insurance policy obtained coverage for freestanding structures. This included detached garages, gazebos, etc. Additionally, policyholders learned that reviewing a policy is essential because a secondary structure may not be included at all and, if covered, may have a minimum limit.
It goes without saying that the one most qualified to review your policy is an insurance professional, someone who definitely takes the lessons learned from a tragic event very seriously.