All states have unique insurance laws following disasters. Many important rights and options are not contained in the insurance contract. California wildfire victims and policyholders are discovering first-hand that some insurance adjusters are not being honest or upfront regarding their rights following the 2017 wildfires.

A press release and bulletins issued by the California Insurance Commissioner Dave Jones noted some of the misstatements being made to California policyholders suffering from the recent wildfires:

1. Incorrect time frame provided to collect full replacement cost to rebuild. Policyholders were told they have between 6 and 12 months. In a state of emergency, as these fires were, policyholders have no less than 24 months under California law.

2.Advised that if they decide not to rebuild in the same location, the policyholder could not receive full replacement benefits. Instead, California law provides policyholders may choose to rebuild in the same location, a new location or purchase an already built home in another location.

3. Told additional living expense benefit would expire in 12 months. Under California law, in a state of emergency, policyholders have up to 24 months.

In my recent trip to the Bay Area this week, I had the opportunity to discuss a couple more glaring examples of wrongdoing by insurance companies. Numerous public adjusters told me they were encountering:

  1. Policyholders being offered 70% of their contents replacement cost if they gave up the right to itemize and produce an inventory as required under the policy.
  2. Policyholders being offered an additional 5% over their full replacement cost coverage. They were not being told of the ‘guaranteed replacement” which some policies provide up to 150%, or of the additional limits for other structures, debris removal, and inflation safeguard.

There is a need for California policyholders to have access to information and a full explanation of their property insurance rights. They also need great public adjusters with a heart to help when needed. Many policyholders are underinsured and have other legal recourses which should be explored as well.

Here are a few of our blogs which can help:

Positive Thought of the Day

Strength does not come from physical capacity. It comes from an indomitable will.
—Mohandas Gandhi