Navigating Wildfire Losses – Your Insurance Roadmap
The recent wildfires in California, particularly around Los Angeles, have caused widespread devastation, leaving homeowners and business owners to rebuild their lives. If you’ve been affected by the wildfires, the insurance claim process can seem overwhelming, but it’s critical to understand your next steps. We’ve created a comprehensive guide to help you navigate the claims process and maximize your insurance benefits.
Immediate Steps to Take After Wildfire Damage
1. Ensure Safety First
The safety of you and your family should always be your top priority. Once you’ve secured your safety, your next step should be to contact your insurance provider to file a claim. Insurance companies require you to report the damage, and an adjuster will evaluate the extent of the loss.
Quick Tip: If your home is completely destroyed, your insurance company must pay you a minimum of one-third of the estimated value of your personal belongings, as well as four months’ worth of rent for temporary housing, regardless of whether an adjuster has inspected your home.
Document Everything for Your Claim
2. Start Documenting the Damage
As soon as it’s safe to return to your property, begin documenting the damage. Take pictures before cleaning up or removing debris—this will be important for your claim. Start a recovery diary and keep detailed records of all communications with your insurance company, including dates, names, and what was discussed. Additionally, keep track of receipts for temporary living expenses, such as hotel bills or rental furniture.
Quick Tip: Being organized and thorough with documentation will help your claim process go more smoothly and provide proof for the necessary reimbursements.
Understanding the Claims Process and Your Coverage
3. Know the Claims Timeline
Wildfire claims can take a significant amount of time to resolve. Depending on your insurance provider, the complexity of the damage, and the volume of claims in the area, the process may take months or even years. However, you don’t have to wait for the entire claim to be processed before receiving some relief.
Quick Tip: If your home was completely destroyed, your insurer is obligated to provide you with partial payments upfront, even before the adjuster inspects the damage. These payments will cover your personal belongings and temporary housing.
Review Your Insurance Offer Carefully
4. Understand Your Settlement Offer
Once an adjuster inspects your property, they may make a settlement offer. Before accepting any offer, it’s important to review your policy carefully. If the offer feels too low, seek a second opinion from an experienced construction professional who can provide a better understanding of the cost of repairs.
Quick Tip: Don’t accept a final payment until you’re sure that the settlement covers the full cost of rebuilding your home or property. You’re entitled to rebuild your property to its original quality, not for upgrades or enhancements unless specified in your policy.
Business Owners: Don’t Forget About Business Interruption Coverage
5. Coverage for Business Losses
If you’re a business owner, your commercial insurance policy may include business interruption coverage, which compensates for lost income and ongoing business expenses. This coverage can help you pay bills and keep your business afloat while you rebuild.
Tip: To file a business interruption claim, gather financial records such as tax returns, contracts, and other documents that show the value of your business and the income it was generating before the disaster.
Post-Disaster Assistance and Resources
6. Additional Support for Recovery
After a disaster like a wildfire, many people find themselves needing additional support. FEMA (Federal Emergency Management Agency) may provide aid if the wildfires are declared a federal disaster, although it may not cover all your losses. It’s also a good idea to visit local assistance centers for help with replacing lost documents (like birth certificates and driver’s licenses) and property tax reassessments.
Quick Tip: Don’t rush your recovery. While it’s tempting to sign contracts with contractors or adjusters immediately, take your time to ensure you’re making informed decisions. Scams and poor workmanship can delay your recovery.
For Renters: Know Your Coverage
7. Renter’s Insurance for Wildfire Damage
If you were renting a property that was affected by a wildfire, your renter’s insurance will likely cover your personal belongings and temporary housing expenses, but not the damage to the building itself. In California’s fire-prone areas, some renter’s insurance policies might exclude wildfire coverage, so it’s essential to review your policy to understand what’s covered.
No Home Insurance? What to Do Next
8. What If I Don’t Have Home Insurance?
If you don’t have homeowner’s insurance, recovering from wildfire damage becomes much more difficult. In some cases, FEMA assistance may be available if the disaster is federally declared. However, this may not be enough to rebuild your home.
Tip: If possible, start planning to rebuild with any resources available to you, and connect with local support organizations to see if they can provide any assistance.
Next Steps in the Insurance Process
Filing an insurance claim after a wildfire can be a lengthy and complex process, but it doesn’t have to be overwhelming. Stay organized, document every detail, and consult with professionals if you need help.
Stay tuned for more updates, tips, and expert advice in our upcoming newsletters as we continue to guide you through maximizing your insurance claim and ensuring a smooth recovery.
Starisks is here to support you through life's uncertainties. We offer comprehensive commercial insurance solutions, including Builders Risk, Property, and Homeowners insurance, to help you navigate and recover from unexpected events. Reach out today to ensure your assets are protected, no matter what challenges lie ahead.
