Affected by the Wildfires in Southern California? You Might be Safe From Home Insurance Cancellations Through 2026 | Global News Avenue

The ongoing wildfires in Southern California have claimed countless lives, devastated local communities, destroyed cherished historical landmarks, and sent thousands of residents into shelters, awaiting word on whether they can safely return home — and if they if the home still exists.

AccuWeather estimates the damage will be as high as $57 billion. Much of the economic recovery will be borne by insurance companies paying claims for damaged and destroyed homes. Insurers, already stretched thin by the devastation caused by wildfires in previous years, have canceled or stopped renewing thousands of home and fire policies in the state’s most fire-prone areas, according to local news reports. As homeowners begin to assess their losses, many will have to rebuild their lives without insurance.

But thanks to recent updates to California law, there is a glimmer of hope Homeowners affected by wildfires.

Good news for California homeowners — for now

The recent moratorium prohibits insurance companies from canceling or not renewing home insurance coverage on homes located near or adjacent to emergency areas for at least one year after a state of emergency is declared.

“The moratorium enacted by the California Legislature prevents post-disaster market instability and protects consumers from abandonment and difficulty obtaining alternative coverage,” said United Policyholders CEO Amy Bach. “This is unique to California. Something.”

Following a Jan. 7 proclamation from Gov. Gavin Newsom, the rules mean homeowners in the Palisades Fire in Los Angeles County will be protected by the moratorium even if their homes are not damaged.

Two days later, Insurance Commissioner Ricardo Lara expanded the moratorium to include ZIP codes affected by the Eaton fire, and the commissioner continues to use the authority of his office to protect Governor Newsom’s emergency declaration authorization More areas below.

Homeowners can find out if their zip code is subject to the one-year moratorium by visiting the following website: California Department of Insurance website.

Homeowners do not necessarily lose their coverage after the moratorium ends. While some insurance companies may decide to stop serving Californians in higher-risk areas, a recent move by Commissioner Laura may incentivize insurance companies to continue offering coverage.

“(Commissioner Laura) did a bunch of things last year that were designed to give insurance companies what they said were the tools to get off the pause button, get back on sales and stop layoffs,” Bach said.

The changes include the ability to determine rates based on predictive catastrophe models rather than historical data, and the right to pass on some reinsurance costs to policyholders in the form of rate increases.

While higher premiums can be painful, they can be a crucial trade-off for continued coverage in fire-prone areas of the state.

But if homeowners still can’t find coverage after the moratorium expires, their options become more complicated.

“If they really can’t find anything in the admitted market (insurers subject to the state’s regulatory system), they can try the non-admitted residual insurance market, which is more loosely regulated,” Bach said. “If they don’t find anything there, the fallback is still the FAIR plan.”

california fair plan is a commercial cooperative that provides insurance to residents who are unable to obtain basic fire insurance through their insurance companies. Because its FAIR plan coverage is a limited catastrophe policy with higher premiums, it is considered a last resort, even though more Californians rely on this coverage each year.

Steps to take if you are denied coverage or your policy is canceled

if you are Coverage is denied or your policy is canceledtalk to your agent or broker to try to figure out why. This could be because you live in a certain area, or it could be something that’s easier to fix, like pruning and removing dead leaves that may increase the risk of fire.

But if nothing can be done, you can still find coverage directly from another insurance company or a company. agent or broker.

“You should start shopping immediately,” Bach said. “Do your best to find an agent or broker who can offer you options. If necessary, expand your search beyond your current agent or broker.

Another option is to contact an organization like Bach Associates Policyholders, a nonprofit that advocates on behalf of policyholders. on the websiteyou can access resources to find affordable insurance, talk to recommended agents, and learn about your rights as a policyholder.