With an increase in wildfires around the world and in California, home insurance has become a hot topic as insurance companies are forced to deny renewals or charge exorbitant premiums to cover risk. One of our Monterey County Association of Realtors representatives recently met with the Insurance Commissioner and other officials to discuss fire insurance concerns. A lot was discussed but I thought I'd share a few of the takeaways:
There has been a 600% increase in non-renewal complaints since 2010.
10 of the 20 most destructive fires in history have been in the last 4 years (CA)
There has been a $25B loss to the industry as a result
The evaluation of properties used to be just on the specific property, now it’s based on imagery of the region the house is in. They look at slope, fuel load, type of fuel and access.
New laws passed for 2019-2020:
SB824- non-renewal protection for all homes in declared disaster areas (who had no losses)
SB894- mandates 2 guaranteed renewals following a loss
AB38- State level fund created to provide assistance to homeowners to pay for fire hardening
AB1816- 75 day mandatory cancellation notice to policy holders (vs. the previous 45 day notice
Fires affect everyone and it will be important for the government and communities to continue to work together to find viable solutions. We'll see what happens.