Fire Insurance Policies

If you are a homeowner in California who has been told that your home insurance policy won’t be renewed, don't panic...there is still hope!

Fire insurance policies protect homeowners against the loss or damage caused by accidental fire, or occurrences caused by fire. These include fires caused by electricity, faulty wiring, gas explosions, lightning and natural disasters. The insurance provides payment for the loss of use of the property due to fire related incidents and additional living expenses if the fire caused uninhabitable conditions.

Due to the risks of wildfires in California and an increase in construction costs, many insurance companies have raised premiums significantly, some even denied issuing new policies. It becomes more challenging to find and maintain coverages in many

high-risk areas for wildfires.

In California, your insurer must provide you a minimum of 75-days notice before your policy expires. There are restrictions on an insurance company’s right to terminate coverage or denying to renew an existing policy. In most parts of the state, you still have options for other insurance companies, however, if you’re located near a brush-heavy or forested area with recent wildfires, you may face a challenge of finding a replacement. 

Many homeowners who have been denied traditional insurance coverage, would turn to Government sponsored insurers, such as The California FAIR Plan for basic fire insurance coverage as their last resort. The FAIR Plan policy would offer protection from wildfire and satisfy a mortgage company’s requirement for a home to be insured, however, it does not cover earthquake, flood, hail, theft vandalism or personal liability.

For more info, visit here.

Some Pros of California FAIR Plan

• Will cover you against major damage when conventional insurance carriers decline.

• Coverage limits recently increased.

• More comprehensive coverage plans now available.

• Add-on insurance available.

The Cons of California FAIR Plan

• Expensive. Add-ons make it even more expensive.

• Coverage limits are lower than available from private insurers.

• Coverage is less comprehensive.

• Intended to be a temporary solution. 

You can also reach out to United Policyholders for assistance to help fix your situation. They would be able to guide what steps you can take or follow to find a replacement policy.

photo by Mike Newbry