California Insurance Commissioner Ricardo Lara is fighting to help wildfire victims receive full compensation without the burden of creating exhaustive inventories of their destroyed possessions.
At a Glance
- Commissioner Lara has requested insurers provide 100% personal property coverage without requiring detailed inventories from fire victims
- Some companies like Pacific Specialty and Chubb have complied, but many insurers are only providing the legally required 30% minimum coverage
- Over 30 wildfires have ignited around Los Angeles since January, creating a crisis for homeowners
- Major insurers like State Farm have stopped selling new policies in high-risk California areas due to wildfire concerns
- Lara is pushing for legislative changes to streamline claims processes for future disasters
Victims Face Painful Inventory Requirements
California Insurance Commissioner Ricardo Lara is demanding insurance companies provide full personal property coverage to wildfire victims without requiring them to complete detailed inventories of everything they lost. This push comes as Los Angeles homeowners struggle to recover from devastating wildfires that have ravaged the region since early January. Current state law only requires insurers to pay at least 30% of a dwelling policy limit, up to $250,000, but Lara wants companies to pay up to 100% without the burdensome itemization process.
Survivors who have lost everything face the daunting task of documenting every possession while simultaneously dealing with finding housing and managing reconstruction efforts. The California Department of Insurance has received numerous complaints about this requirement, with some victims describing the process as psychologically tormenting during an already traumatic time.
The response from insurance companies has been mixed. Some insurers, including Pacific Specialty, Chubb, Cincinnati, and Lloyd’s of London have agreed to provide 100% coverage without requiring detailed itemization. Other companies have offered between 75% and 100% of content limits without demanding complete inventories. However, many insurers continue to insist on the exhaustive documentation process, causing further distress to victims.
One Palisades resident described the inventory process as “beyond painful,” explaining that “to sit there with a spreadsheet at such a devastating time and to be reminded, item by item, of what you lost when your home is gone is beyond comprehension… if you can even remember everything that you had. A total loss is a total loss. It feels like the insurance companies are trying to break our collective will, so we give up and they don’t have to pay out.”
The wildfire crisis has exacerbated California’s already precarious insurance market. Major insurers including State Farm and Allstate have stopped selling new property insurance policies in the state due to increasing wildfire risks attributed to climate change. Seven of the top twelve insurers in California have reduced their coverage footprint in recent years, leaving many homeowners with limited options for protection.
The California FAIR Plan, intended as a last-resort insurer, is facing its biggest crisis since the 1994 Northridge earthquake, with potential losses from the Los Angeles wildfires estimated at up to $45 billion. Commissioner Lara has used his emergency powers to prevent policy cancellations in wildfire-affected areas and is working on regulations to help insurers manage their risk while maintaining market stability.
We’re sure our readers will join us in wishing victims well in their quest to get what is rightfully theirs…but it’s hard to ignore the fact that California’s Democratic leadership could have enacted policies that prevented this crisis to begin with, isn’t it?
