The following is a sponsored content post from one of our 2019 Fire Season Coverage Partners, Richard Selzer.
Homeowners Insurance and Wildfire Coverage
If your home burned in last fall’s wildfires, you may be interested in the following bills.
AB 1797: Replacement cost coverage
With a few minor exemptions, this bill requires an insurer that provides replacement-cost coverage to provide an estimate of the cost to rebuild or replace the insured structure that complies with specified existing regulations. This estimate would need to be updated every other year or when it’s time to renew the policy.
It’s still up to policyholders to select the coverage limits for their homeowners insurance. This bill was signed by the governor last summer and will go into effect July 1, 2019.
AB 1875: Online insurance finder
This bill, which was signed by the governor, requires the California Department of Insurance (CDI) to establish an online tool called the California Home Insurance Finder to help homeowners find and compare residential insurance options. To do this, the CDI will have to gather information via an annual survey of insurance brokers. It will then promote the online tool and make it available in various languages starting no later than July 1, 2020.
AB 1923: Wildfire debris removal
When the governor declares a state of emergency after wildfires like those we’ve faced in recent years, authorities can activate consolidated debris removal programs for large-scale clean up. This new bill would allow local governments to pay for the clean up by collecting money from the insurance companies of covered homes in the area, as long as the homeowner grants access to their property through a right of entry form.
AB 2611: Appealing wildfire insurance decisions
Right now, insurance companies cannot cancel policies or fail to renew them just because a property sustained fire damage. Assembly Bill 2611 would create an appeal process for disagreements between homeowners and insurers about whether a policy is issued and/or the premium for that policy based on a wildfire risk model.
The insurer has 30 calendar days to respond to the homeowner’s appeal, during which the insurer can’t cancel, increase the premium, fail to renew or make any other adverse underwriting decisions toward the homeowner.
If the insurer denies the appeal, the insurer must provide factual evidence for the decision and let the homeowners know they can appeal again, this time to the Department of Insurance.
AB 3166: FAIR Insurance plans
The Fair Access to Insurance Requirements (FAIR) Plan Association assures that basic home insurance plans are available for homeowners who don’t qualify or can’t afford more comprehensive homeowners insurance. Although mainstream insurers have these basic plans, they don’t always publicize them. This bill would require insurers to inform homeowners about these FAIR Plan Association policies so homeowners know their full range of insurance options.
AB 1772: Extending insurance collection times
Insurance companies limit the time homeowners can apply for benefits after fire-related loss or damage. This bill extends the minimum time limit during which a homeowner may collect the full replacement cost of a loss relating to a state of emergency from the current 24 months to 36 months—that is, from two years to three years—with additional extensions of 6 months for good cause. This was signed by the governor.
If you have questions about real estate or property management, please contact me at [email protected] or call (707) 462-4000. If you’d like to read previous articles, visit my blog at www.richardselzer.com.
Dick Selzer is a real estate broker who has been in the business for more than 40 years.