A man lost his store in the Eaton Fire. How does this affect his business insurance?
LOS ANGELES (KABC) -- ABC7 is on your side, helping you get answers to your top questions after the devastating Los Angeles wildfires.
A business owner who lost his building in the Eaton Fire reached out to Eyewitness News, asking what to do about the monthly insurance payments he is still paying.
But business and homeowners insurance can be very different.
Bassem Sayegh has owned his building on Lake Avenue and Mariposa Street in Altadena since 1975. It was one of the many structures that was destroyed.
"It was horrifying," he said. "It was just like heartbreaking. I mean, this is like my livelihood in there."
He said around 7:30 p.m. on the night of the Eaton Fire, the store was fine. But it was gone about an hour later.
Sayegh said he's been with State Farm for decades and called them as soon as he could. Since he no longer has a building, he wondered what happens to his policy.
He was told he has to keep paying it.
"To be paying for something that's not useful anymore, I mean, for now at least, so we don't know when it's going to be built, whether it's going to be built in a year ... 2, 3, 4 ... God knows," said Sayegh.
Differences between business and homeowners insurance
Insurance agent Rick Dinger with Crescenta Valley Insurance, who's not involved in Sayegh's case, said business insurance is different from homeowners insurance.
He said there are reasons to keep that policy in effect, even if there is no building left.
"You do definitely want to keep your coverage for a few reasons," explained Dinger. "First of all, you still have liability factors here. You own the property, you own the stuff that's on there. There's going to be people kind of treading on your property for different reasons. Maybe they should be there or not, but nonetheless, you're still held liable if something goes wrong, if somebody falls and hurts themselves on the property."
He also said there could be ways to reduce the premium.
"Talk to their insurance agent, make sure they talk about what the rating factors are, if they can adjust some of those to reduce their premiums, maybe consider raising their deductible now," said Dinger.
State Farm told us it can't comment on Sayegh's case, but sent ABC7 a statement, which read in part, "Coverage needs for liability and property coverages will vary for customers depending on their individual needs during the rebuilding phase and beyond. While customers recover and rebuild, we advise them to speak with their State Farm agent about ongoing coverage needs."
Dinger said if the insurance policy is canceled, the owner might not be able to find a new one.
"When you go to rebuild, it's going to be difficult to buy new insurance," he said. "Obviously you're not going to be a preferred customer because you just had a major loss, so hopefully, most often the carrier will stay on board as you do the rebuild and pay to rebuild the building."
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