ABC7 has reported on insurance companies canceling policies in wildfire-prone areas in Southern California, so what's the state doing about it now? Here's what you need to know.
Gov. Gavin Newsom has proclaimed a state of emergency in Ventura County, so this allows the Insurance Commissioner to impose a moratorium on cancellations in those areas.
"The purpose there is to just give consumers and homeowners some breathing room to recover and to make sure that they have that peace of mind that their insurance policies are still there," explained Gabriel Sanchez with the California Department of Insurance.
However, that would not apply to anyone trying to get new insurance in these areas. Companies have already stopped issuing new policies.
"At this point, we're getting moratoriums. Obviously, insurance carriers are closing those zip codes, so we can't do any new business there," said Rick Dinger with Crescenta Valley Insurance. "So if somebody's buying a new home, that's going to cause them some major grief."
How does the moratorium work?
After Newsom's state of emergency, the Department of Insurance partners with CAL-FIRE and the Governor's Office of Emergency Services to identify wildfire perimeters and adjacent ZIP codes within the mandatory moratorium areas.
The protection from cancellation or non-renewal lasts for one year from the date of the governor's emergency declaration, according to the Department of Insurance's website.
"Even if you don't experience property damage, wildfires take a heavy emotional and financial toll," said Insurance Commissioner Ricardo Lara in a press release issued on Friday. "As we continue to roll out long-term reforms over the next few months, it's critical that people have the coverage they need in the aftermath of a wildfire. Insurance benefits can help survivors recover quickly and cover added expenses, like the cost of evacuations. Once the fires are contained, we'll be on the ground, assisting those affected and enforcing California's strong consumer protections to help them rebuild and recover."
How can I find out if I'm protected?
The Department of Insurance has an online service that allows you to find if your ZIP Code was included under any mandatory moratorium.
You can find that website here.
Lara reminds residents in Ventura County who have been ordered to evacuate that their homeowners' or renters' insurance may help with evacuation and relocation costs under Additional Living Expenses coverage, known as ALE.
ALE typically includes food and housing costs, furniture rental, relocation and storage, and extra transportation expenses, among other costs.
If you have any questions or need assistance, the California Department of Insurance is here to help. Please call: 1-800-927-4357 or visit www.insurance.ca.gov.
What can homeowners do to prepare?
The Department of Insurance advises homeowners to prepare early in case you have to evacuate your home and have to submit a claim later.
"Take an inventory of things in your home, things like different possessions, whether they be furniture, jewelry, other types of things, and even, if possible, if you're able to take a video record of this," explained Sanchez.
Here are some tips from the Department of Insurance's website.
- Keep all receipts during your evacuation
- Policy provisions, including deductibles, vary by company, and residents should check with their insurance company or agent as soon as possible to confirm coverage, limits, and any other limitations and documentation requirements. Most renter's policies also typically include ALE coverage
- Document the date, time, and names of any insurance company employees you speak to regarding your coverage
- Make sure any insurance agent or public adjuster offering services has a valid license by checking online with the Department of Insurance
- Under existing law, public adjusters cannot solicit business for seven calendar days after a disaster
- Don't forget copies of insurance policies, important papers, and a photo or video inventory of your possessions. An inventory can be completed quickly and easily on your smart phone and safely stored in the Cloud
Over the last two years, a number of insurers have left the state. Californians are already dealing with high premiums and now, they could go higher.
"Insurance companies are being pummeled with these losses, these natural disaster losses, and they're in business to make money, so they've got no choice but to raise the rates," said Dinger.