California Wildfire Claims Crush Claims Departments In Midst Of Nationwide Natural Disaster Claims. Most Are Homeowners And Automobile Policy Claims.
By Lonce Lamonte - October 24, 2017
California’s deadly wildfires, which commenced in mid-October, have brought forth tens of thousands of claims with insurance companies. Needless to say, the reimbursement process ahead will inevitable frustrate most home and vehicle owners.
Fires have damaged or destroyed more than 7,000 structures in several counties in the state, according to California Insurance Commissioner Dave Jones.
Residents have left evacuation centers since a week to ten days ago to begin the long and exhausting route to recovery.
Preliminary data from eight California insurers, which are processing claims for tens of thousands of policyholders, reflect $1.045 billion in losses from the devastating fires, including commercial and residential structures, personal and commercial vehicles, and agricultural equipment. Those figures are expected to rise, Dave Jones said.
“These numbers are just the beginning of the story as one of the deadliest and costliest wildfire catastrophes in California’s history,” Jones said. “The tragic death of 42 people and over a billion in property losses are numbers — behind these numbers are thousands of people who’ve been traumatized by unfathomable loss.”
Two big insurers — Farmers Insurance and State Farm Insurance — said they have received about 7,000 claims so far in connection with California’s infernos. The vast majority are linked to the blazes from the Santa Rosa area in Northern California and the Tubbs fire, and are homeowners’ insurance claims, officials reported.
Homeowners now face the harrowing task of recouping losses from their insurers. Reimbursement could be slowed if insurers’ capital is spread thin due to the other natural disasters which have pounded one after the other. Homeowners with unrealistic expectations about reimbursement may not have read into the fine print of their policies, experts warn.
The other recent natural disasters which exacerbate the present situation are the brutal hurricanes that drenched Texas and Florida and ravaged Puerto Rico. These may strain the reserves of even the major insurers.
No insurer could have foreseen this magnitude, and with this they may not be able to pay in full. There is no way with this monumental magnitude the process could turn out to be painless.
State Farm reported over ten days ago that it had received 2,100 homeowners’ insurance claims connected with the California wildfires and 800 automobile claims. Then approximately a week later, State Farm reported receiving more than 4,300 claims, including 3,220 homeowners’ claims and 1,100 vehicle claims.
Farmers Insurance said it received about 2,700 claims in connection with the North Bay wildfires. The vast majority were homeowners’ claims.
Often policy holders have a misconception that their policies were written to replace their homes. But the majority of policies don’t provide for that. Insureds are regularly substantially underinsured.
by journalist Lonce Lamonte, lonce@adjustercom.com
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