Written on behalf of Brian Kabateck
November 8, 2019
It’s been a year since the Woolsey Fire, L.A. County’s most destructive fire, burned more than 1,600 homes and consumed 96,000 acres in both L.A. and Ventura County. A recent article by the Los Angeles Times reported that Southern California Edison’s electrical equipment is likely to blame for the fire. The state continues to deal with wildfires due to the dangerous Santa Ana winds and dry conditions, which prompted an extreme red flag warning for most of Southern California in late October and sparked at least 16 fires.
Fire crews in Northern California are still mopping up the massive Kincade Fire, which burned for 11 days and burned nearly 78,000 acres. Experts caution that the recent fires may be a preview of what the state can expect later this season. Many people are still in the process of trying to piece their lives back together from last year’s catastrophic wildfires while dealing with this year’s fire season as well. It’s important for consumers who live in an area at high risk of fires to be well informed and prepared, and know what protocol to take after the damage has been done.
Pacific Gas and Electric Company (PG&E) has been dealing with a flood of lawsuits involving the 2017 and 2018 wildfires after it was found that its equipment was to blame for igniting the fires in Northern California. Earlier this year, the utility company was forced to file for bankruptcy in response to the lawsuits, which resulted in a $30 billion liability for PG&E. In July, Governor Gavin Newsom signed AB 1054 into law, which created two separate funds for utilities facing wildfire liabilities. While the money will be used to deal with claims related to the fires and keep utility rates down, it won’t do much for insurance premiums. The bill requires major utilities to spend at least $5 billion on safety improvements and meet new safety standards, as well as create a $21 billion fund that would help pay out the claims. The fund was intended for future wildfire victims, and not for the victims of the wildfires whose homes were destroyed in 2017 and 2018.
Last month, Governor Gavin Newsom announced that his administration had granted a $75 million program to help with the power shutoffs planned ahead of the wildfires to help prevent new fires from igniting. The grant funding would be used to secure equipment, such as generators and associated connections, fuel storage, backup energy sources for fire stations, community centers, hospitals and other health facilities, backup emergency communications equipment, and for developing and conducting plans that better prepare communities for outages.
Homeowners must understand their insurance policies and ensure they have enough coverage before the start of the wildfire season. Wildfires are a “covered peril” in most homeowners’ insurance policies. Many homeowners do not have enough insurance to rebuild their homes because although construction costs have increased substantially over the last two decades, most homeowners’ coverage has not. The policy should also cover accommodations while a homeowner is displaced until the house is repaired or rebuilt. Many homeowners are finding that their current insurance company is not offering renewals because their home is located in a high-risk fire or brush area. New home buyers in those areas are finding that getting the right coverage can be tough. If you own a home in these areas, many companies may not be willing to write coverage for you. Insurance companies claim that wildfires in California have become so widespread and that the number of claims is so high, it makes it difficult to conduct business in the state. Insurers are using computer models to assess the risk of fires in certain areas and for individual homes and are deciding that they are exposed to too much risk.
Dealing with insurance companies after a wildfire can be very stressful for homeowners, and they can find themselves struggling to secure affordable insurance or any policy that may be able to help them. Having to pick up the pieces after your home has been damaged or destroyed by a wildfire can be rough. But knowing what your insurance covers and what may not be covered may help you be better prepared.
KBK is working with victims impacted by California wildfires to ensure they know their legal rights and are justly compensated for their loss. If you have been impacted by California wildfires and are underinsured or have been underpaid by your insurance company, fill out our Consultation Form for a free and confidential case evaluation.