
What homeowners need to know about insurance post natural disaster
The recent devastating wildfires in Los Angeles have left many families and business owners grappling with the aftermath of destruction and loss. Our thoughts are with all those affected by these tragic events.
While nothing can replace the emotional and physical toll of a wildfire or natural disaster, understanding your insurance policy and how to prepare can provide critical support as you rebuild your life.
Navigating the complexities of insurance coverage can be intimidating for homeowners and business owners. From understanding what a policy covers to knowing how to dispute claim valuations and denials, being informed, along with the guidance of an insurance coverage attorney, will assist in protecting your property and financial stability.
What does your insurance cover after a wildfire?
Most standard homeowner and business insurance policies include the following:
- Structure coverage: Protection for any damages to the main structure of your home or business.
- Other structures coverage: Coverage for detached structures, such as garages, sheds, or fences.
- Contents coverage: Reimbursement for damaged or destroyed personal property inside the structure.
- Loss of use/additional living expenses: Compensation for temporary housing or increased living expenses if you cannot remain in your home.
- Building ordinance or law coverage: This covers costs to upgrade a structure to current building codes during the rebuilding process.
- Debris removal: Reimbursement for removing wildfire debris from your property.
Common reasons for claim denials and how to dispute them:
While wildfire losses are generally covered by insurance, disputes can arise for various reasons, such as misunderstandings about policy coverages, limits, deductibles, and the timing and amounts owed for the policy coverages. For example, deductibles may be contested if the cause of the fire, such as an electrical fire spread by wind, does not align with the policy’s definition in relation to an increased “wildfire” deductible. Or the amount that a carrier asserts as a reasonable value for your personal property may be contested where no like/kind replacements can actually be found for that amount. To navigate these complexities, it is crucial to carefully review your policy, consult with an attorney or insurance expert, and provide detailed documentation of the damages. If you disagree with how your claim is being handled, firmly and always politely challenge the decision with supporting evidence.
Addressing underinsurance issues:
Discovering that your insurance policy does not fully cover rebuilding or replacement costs can seem daunting, but there are options available to help. Federal Emergency Management Agency (FEMA) resources can provide assistance to those who are underinsured, offering vital support during the recovery period. Additionally, reaching out to your mortgage lender to explore options such as mortgage forbearance can help pause or reduce payments while you work to recover from the natural disaster.
Ensuring fair compensation for living expenses:
Temporary housing and other additional living expenses can quickly add up. To ensure fair reimbursement for your housing and living expenses, make sure to document all expenses meticulously, including hotel receipts or leases, increased meal costs, and other increased expenses incurred. Further, if you find that the insurer’s valuation is insufficient for what is actually available in the marketplace, you can counter by providing evidence to support your claim.
Exclusions and deadlines to be aware of:
Unlike some natural disasters, wildfires are generally not excluded under provisions like “Acts of God” in standard insurance policies. However, it is important to remain mindful of key factors when filing a claim. Filing deadlines, which vary by policy and jurisdiction, must be met to ensure your claim is processed on time. Another factor to consider—expediting your claim requires promptly providing all requested documentation, maintaining regular communication with your insurance adjuster to avoid any unnecessary delays, and always being kind and courteous to your adjuster.
Proactive steps for fire-prone areas:
Homeowners and business owners in fire-prone regions should take several precautionary steps to protect their homes and belongings:
- Follow local fire authorities’ recommendations for brush clearance and defensible space around your property. Some policies actually require a particular amount of defensible space around your property, which could affect coverage.
- Use fire-resistant building materials and consider retrofitting, or making improvements to improve your home’s energy efficiency. In particular, ensure all exterior venting is properly protected from potential entry by wind blown embers. These actions will assist in minimizing fire risk for all.
- Review and update your insurance policy annually to ensure adequate coverage for rebuilding and replacement costs. If significant improvements are made during the policy year, promptly advise your carrier so that limits may be appropriately adjusted.
Conclusion:
Wildfires are unpredictable and devastating, but taking the time to understand your insurance policy and implementing preventative measures can make a significant difference. Connecting with an insurance coverage attorney will ensure you are fully prepared for the unexpected.
Our hearts remain with the families and communities affected by the recent LA fires.
Get MORE. Insights
Stay ahead in the legal world – subscribe now to receive the latest insights and news from Fennemore Law Directly in your inbox!