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David Melnarik / KHTS News

Insurance Companies Cannot Deny Coverage To Homeowners Due To Fire Risk For One Year

The insurance commissioner announced Thursday that insurance companies cannot deny Santa Clarita homeowners coverage due to the risk of brush fires for the next year, officials said.

On Thursday, Insurance Commissioner Ricardo Lara issued a mandatory one-year moratorium on insurance companies non-renewing policyholders which is set to help at least 800,000 homeowners in wildfire disaster areas in Northern and Southern California, including Santa Clarita, according to Lara’s office.

In August, the Department of Insurance released data revealing insurance companies are dropping an increasing number of residents in areas with high wildfire risk.

The number of non-renewals rose by more than 10 percent last year, the data showed.

The moratorium is the result of Senate Bill 824, authored last year by Lara while serving as a state senator in order to give temporary relief from non-renewals to residents living near a declared wildfire disaster, according to officials.

“This wildfire insurance crisis has been years in the making, but it is an emergency we must deal with now if we are going to keep the California dream of homeownership from becoming the California nightmare, as an increasing number of homeowners struggle to find coverage,” Lara said. “I am calling on insurance companies to push the pause button on issuing non-renewals for one year to give breathing room to communities and homeowners while they adapt and mitigate risks, give the Legislature time to work on additional lasting solutions, and allow California’s insurance market to stabilize.”

This is the first time the department has invoked the new law, which took effect in January, according to officials.

Due to the homeowner insurance crisis extends beyond the wildfire perimeters and impacts residents statewide, Lara went a step further and called on insurance companies to voluntarily cease all non-renewals related to wildfire risk statewide until December 5, 2020, in the wake of Governor Gavin Newsom’s declaration of statewide emergency due to fires and extreme weather conditions, according to officials.

A statewide moratorium would provide all California and Santa Clarita homeowners, renters and businesses peace of mind, and allow time for stakeholders to come together to work on lasting solutions, help reduce wildfire risk and stabilize the insurance market, said officials.

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Insurance Companies Cannot Deny Coverage To Homeowners Due To Fire Risk For One Year

8 comments

  1. A little late in my case. I’m on my third carrier this year. Good first step. Now what.

    • The ‘now what’ you mention may be an indicator you have at least a year to sell your home, should you decide to, unless tighter regulations on insurers are put into effect. But also consider, the whole state is now in a year round fire season due to the ever-growing climate change emergency. What to do, indeed.

      • “Due to the ever-growing climate change emergency?” Been drinking the koolaid huh? The “climate change emergency” has been around since the 30’s and it’s mostly nonsense.

        • Just as the tobacco industry lied to us about the harmful effects from smoking even to the point of saying it was good for you, so has the leading culprit in planetary warming, the fossil fuel industry.
          If you wish to believe them rather than science, how do you explain the following, Jackson?
          Global temperature rise
          Warming oceans
          Shrinking ice sheets
          Glacial retreat
          Decreased snow cover
          Sea level rise
          Declining Arctic sea ice
          Ocean acidification
          *The above information is from NASA.

  2. They may not be able to drop you but does that mean they can’t charge you more for your insurance? I renewed 2 months ago and my fire insurance doubled.

    • Mine tripled, the insurance companies need to up the bonuses. And if we have another 2008 recession we’ll bail them out again.
      This is called price gouging and the owners of these companies should be thrown in jail

  3. Thank you for this. My insurance company said they will not renew our policy but after I told them about this they agreed to renew.

  4. A one year moritorium on non-renewals is not enough. Even California Fair Plan actively seeks to deny coverage or renewals to many in high risk areas as an insurer, citing conditions that have nothing to do with fire risk to structures such as trip hazards in the yard, while their policy provides no injury liability coverage whatsoever – with no appeals process. Regulations should not permit this. Other companies can discriminate at will, refusing to offer fire policies at all to those in high risk areas or based on satellite imagery. What the state needs to do is work with insurers to educate homeowners on how they can reduce their homes susceptibility to fire and provide incentives for making homes and structures more resilient, including policy discounts and grants for homeowners who take steps to retrofit their homes with tight wire mesh over attic vents, boxed eaves, appropriate landscaping and hardscaping within 10 feet of the structure, fire suppression systems and more. Preparation and prevention are key to mitigating risk of loss for both homeowners and insurers, stabilizing the insurance market as well as safeguarding lives and economic interests throughout the state. An ounce of prevention is worth a pound of cure.

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About Louie Diaz

Louie was born and raised in Santa Clarita. At the age of two Louie lost his vision due to a brain tumor. However, Louie doesn't let blindness stop him from doing what ever it is he wants to accomplish. Growing up some of his favorite hobbies were wood working, fishing and riding bikes. Louie graduated from College of the Canyon in December of 2017, with a Broadcast Journalism degree. Growing up Louie has always wanted to be a fire fighter or a police officer, but because of his blindness Louie knew that wouldn't work. Louie has always loved listening to police and fire radio traffic, using a scanner, and he figured if he was going to listen to the scanner so much, he should do something with it.