Insurance non-renewals hitting mountain communities the hardest
Special to The Union
California Insurance Commissioner Ricardo Lara spoke to Placer County community members at a recent town hall to address concerns over increased insurance cancellations and non-renewals.
“We know 10 of the 20 most destructive wildfires in California history have occurred over the last three years,” said Lara, who noted that as the risk of wildfire increases, so does the cost of insurance while the availability of insurance decreases.
According to the California Department of Insurance, homes that are being hit the hardest with non-renewals are within the Wildland Urban Interface, the zone of land between wildland and human development, such as the North Lake Tahoe areas.
The department reported that more than 9,000 Placer County residents were dropped by their insurers between 2015 and 2018, not including residents who may have been dropped following wildfires in 2018.
“We know that there’s a lack of affordable insurance in the traditional homeowners market in the WUI,” said Lara. “We’re experiencing this tremendous change where non-renewals continue to climb.”
Survey says county costs climbing
A survey sent out by Placer County between July and August showed that half of the 2,156 residents who responded said their homeowners insurance has been canceled or they have received a notice of non-renewal, while 15% said their premiums increased substantially.
More than 34% of residents who had secured a new policy reported that it cost them more than double the previous one, with several reporting increases of more than 500%.
“Of those that took the survey, over half were non-renewed. That’s well above what the state is reporting,” said Placer County Board Supervisor Cindy Gustafson. “It’s very clear that our communities are being hit the hardest.”
For those whose insurance had been canceled only 14% received a site visit to their home from their insurance company before the cancellation.
LARA: Hardening homes matters
“Insurance companies are not considering your pre-fire mitigation. Many of you don’t even get inspections and you’re still getting dropped,” said Lara. “If you have done everything possible to harden your home we should be able to, as a department, force insurance companies to cover you.”
Lara said he hopes to work with the state legislature to ensure that insurance companies will cover a homeowners have taken every precaution to mitigate the risk of wildfires on their property.
“We’re asking you to harden your homes and do your defensible space,” said Gustafson. “We want the insurers to pay attention to what you’re doing and what we are doing as your municipalities and your counties to help support that.”
To respond to the crisis homeowners are facing the Department of Insurance began dispatching a strike team in August to areas affected by insurance non-renewals. The team is meant to connect residents with resources and assist local governments in responding to the insurance issues.
The department has also began issuing notices to insurers following the 2017 and 2018 fires to ensure claims are handled fairly.
Hannah Jones is a reporter for the Sierra Sun, a sister newspaper of The Union. She can be reached at firstname.lastname@example.org or 530-550-2652.
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