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At the end of 2017, wildfires ignited across both Northern and Southern California and caused heavy property damage and displacement. Here’s a quick summary of the fires’ impacts:
- Nearly 9,000 wildfires in total
- 1.2 million acres of land burnt
- Over 10,800 structures destroyed
- At least 46 individuals killed and over 100 injured
The severe damage to residential and commercial property made the period during and following the fires very stressful for insurers as well as the individuals and families affected. On December 8, 2017, the state’s Department of Insurance issued a press release to all property/casualty insurance companies and other interested parties addressing how insurance procedures should be handled in order to best aid victims of the wildfires in Southern California.
Insurance Commissioner Dave Jones called upon all property insurance companies to implement emergency expedited claims and billing grace periods in order to help residents and businesses to initiate their recovery processes and rebuild more quickly than they would ordinarily.
The following factors were addressed in the release:
- Additional Living Expenses (ALE): Insurers were instructed to adopt a standard ALE advance payment of at least 4 months for a total loss, along with additional ALE made available upon request.
- Personal Property (Contents): Insurers were called upon to provide a standard contents advance payment of at least 25% of policy limits for a total loss of the primary residence in a wildfire disaster, with additional contents payments available upon request.
- Vehicles Claims: Insurers should expedite payment of automobile property damage under comprehensive loss coverage.
- Billing: Billing leniency should have been granted for at least 30 days for customers in designated wildfire disaster areas.
- Debris Removal: The release called upon insurers to coordinate with city, county, and state agencies on an expedited debris removal process.
- Inventory Forms:
- Inventory Itemization: Insurers were asked to accept reduced itemization of contents in wildfire total losses.
As stated above, insurers were asked by the California Department of Insurance to advance up to 25 percent of their contents limits. However, Farmers Insurance Group took it further for their customers affected by the California wildfires, initially advancing up to 30 percent or $150,000 of the contents limit with no inventory required.
As of January 8, 2018, Farmers made an adjustment to advance 60 percent of the contents limit to customers with a total loss (with no inventory required), due to the extraordinary circumstances that were created by the December wildfires.
Farmers’ claims team has been working directly with its customers to ensure that they understand this change, and has made specially trained claims professionals available to all customers in order to assist them in documenting their contents claim. This will help them to ensure that they will be fully compensated for their personal property losses up to the personal property policy limit.
Farmers greatly values its customers and how it has thus far responded to the recent wildfires, and hopes to continue to assist its customers through any additional losses.
About Scott Litman Insurance Agency
At Scott Litman Insurance Agency, we are dedicated to protecting HOA’s like yours. We have a unique understanding of the industry and the common risk exposures that you face in your daily operations. In fact, we find that 90% of the policies we review are missing coverages that violate the Covenants, Conditions and Restrictions (CC&R), exposing the board, HOA and management to lawsuits– which is why our comprehensive policies are tailored to meet your specific needs at competitive prices. For more information about our products, contact our experts today at (818) 879-5980 ext. 201, or fill out our online form.