As the state prepares for another dangerous wildfire season, coverage is in the spotlight.
California homeowners insurance policies are becoming a serious subject at the moment. With the approach of the wildfire season, a growing number of property owners are losing their coverage.
That said, the issue of spiking premiums and reduced availability isn’t anything new.
A recent New York Times report looked at the issue of California homeowners insurance policies. It examined the way the state has been trying to manage these challenges for a long time. It pointed to a letter Consumer Watchdog president Jamie Court wrote to the California Department of Insurance two years ago. It spoke in defense of consumers who were facing skyrocketing premiums as a result of the wildfires in the state.
Despite the fact that the letter was written two years ago, it remains poignant. Last fall’s wildfire season in the state killed 85 people and wiped out nearly the entire town of Paradise. In Court’s letter, he called for the Department of Insurance to take steps to protect residents suffering from insufficient coverage and cost prohibitive premiums following the fires of the year before.
Wildfires the year after Court’s letter were worse as are California homeowners insurance policies.
“California residents who have seen homes turned to ash are concerned that they may now get burned by their own insurance company,” wrote Court in his letter of October 2017. Nearly two years later, some homeowners in those same areas are still unable to find coverage or are not able to afford the high premiums of what is available.
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The New York Times report underscored the trend in California for wildfire season preparations. People are already purchasing home battery systems and generators. Utility companies are inspecting and trimming trees within their service areas. A broad effort is being made in the name of prevention and preparedness. That said, one of the primary steps – insurance coverage – remains unavailable to many people who are at the greatest risk.
The California Department of Insurance does not record data regarding the number of residents who lose their home policies due to wildfire risks. However, over the last eight years, the number of complaints about precisely that topic have risen considerably.
In 2010, it had received 41 complaints about the lack of California homeowners insurance policies in those areas (or the availability of only prohibitively expensive coverage). In 2018, that number boomed to 276.