By MICHELE BARNUM | Special to the Palisadian-Post
After several years of record-breaking California wildfires, the recent fire in The Highlands and the Palisades evacuations, many clients and friends have had their insurance premiums increased, been denied coverage or even cancelled.
It is important to know your rights if you get a cancellation notice from your insurance company.
Here are some tips from the California Association of Realtors to help maintain your current insurance plan or find a new one.
Know your rights: If your insurance company is not going to renew your policy, they must notify you in writing at least 45 days before the expiration date. If you didn’t receive the proper notice, contact the California Department of Insurance (DOI) at 1-800-927-HELP or online at insurance.ca.gov.
Check to see if your policy has a guaranteed renewal provision. You may also be entitled to a renewal under laws applicable to homes that are lost in a declared disaster.
Contact Your Insurance Company Immediately: If you receive a notice of a rate increase or non-renewal, get in touch with your insurance agent immediately to see if there are fire-hardening steps you can take to change the company’s decision.
Start Shopping for Insurance Early: Filling out applications and getting quotes takes time. Working with an insurance agent could speed things up. The DOI website has a tool to help you find agents and brokers near you. Check to see if the agent works with one insurance company or has access to multiple carriers.
Check for Policies Written by Admitted Insurance Companies: Admitted insurance companies are backed by the California Insurance Guarantee Association (CIGA), which provides protections if the carrier becomes insolvent. Check the Residential Insurance Contact List on the DOI website for a list of these companies.
Make Sure You Are Not Underinsured: Make sure your policy will cover the likely cost to rebuild your home in compliance with current building codes. Consider insuring your property for replacement cost value not just depreciated actual value.
Compare Types of Coverage and Limits: If you have any questions, ask your insurance agent. For example: Will the policy cover the cost of rebuilding your home to its pre-loss condition? Does it cover demolition and debris removal? Is there a coverage limit on temporary rent and expenses while the home is being repaired? What causes of loss are not covered?
Check Surplus Lines Insurance Options if Necessary: Surplus lines (aka “non-admitted”) carriers do not have CIGA protection, but they can have more flexible offerings and may be the best solution. Make sure to investigate the overall financial strength by checking A.M. Best at ambest.com or a similar service.
Use the Fair Plan as the Last Resort: The FAIR Plan policy can be expensive and it only covers certain losses by fire and smoke, so you will need to buy Differences in Conditions (DIC) insurance to cover other perils such as theft and liability. California FAIR Plan can be reached at 800-339-4099.
Michele Barnum is a member of The Marguleas Team of Amalfi Estates. Michele truly believes in giving back to her community and gives back 10% of her commission from each sale among five charities: Make-a-Wish, SPCA-LA, American Cancer Society, PATH, which helps homelessness, and Homeboy Industries. The team has been fortunate to have donated $1 million since 2014. Michele can be reached on her cell at 310-804-7054 or firstname.lastname@example.org.
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