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What were avoidable insurance gaps from the California wildfires?

On Behalf of | Nov 30, 2022 | Insurance Disputes

Insurance is a protective device that is supposed to replace items and compensate people for what they have lost. In California, there are specific challenges that frequently lead to property owners filing claims. In recent years, wildfires have come to the forefront in this way.

A common problem that came up for many homeowners were claim denials or not getting as much as they expected from the insurance company. When seeking coverage in the future, it is wise to be aware of what was lacking in their policies and ensure that current coverage is sufficient if the wildfires cause damage to homes again.

Underinsurance and rising costs were problematic

People might not have known the amount of insurance they needed to rebuild adequately. They could have been covered for the damage from wildfires, but it was not enough to pay for the repairs that were needed. In insurance-speak, this is called inadequate insurance-to-value.

Another problem people have faced is due to the economy in general. As inflation hits and raises the costs of goods and services, it has an impact on aspects that might not have been thought about when getting wildfire insurance: construction costs. If the materials cost more, that will bleed down to the consumer. Also, there are new building codes to contend with and making sure the property is up to standard can be expensive.

The reality of a wildfire is that it is not a simple matter of rebuilding. The property must be inspected and in many instances, there was damage to the foundation that required an entirely new foundation. This will increase the cost that the homeowner will need to pay if there was not enough insurance coverage.

For insurance problems, professionals who specialize in these cases may help

Even if a homeowner is under the impression that they have enough insurance to rebuild, repair and replace what was lost in a wildfire, they still have the insurance company and its adjusters to contend with. There might be a disagreement as to the interpretation of the policy or the company might not pay what the homeowner believes is reasonable and fair for all that was lost. They might deny the claim entirely.

There are options to fight the insurance company and get what the policy says the homeowner should receive. Professionals who are experienced in insurance disputes know how insurers operate and can assess the case accurately to forge solutions that can be essential in reaching a reasonable result.