Insurers in Massive California Fires Agree to Claim Handling Reforms

October 14, 2015

Insurers handling wildfire damage from the Valley and Butte wildfires last month in Northern California has agreed to a claims handling process to help fire victims begin their recovery more quickly, Insurance Commissioner Dave Jones announced on Wednesday.

More than 5,000 homes were damaged and destroyed in the Valley and Butte fires.

Insurers representing 90 percent of the claims resulting from the fires have agreed to claims handling reforms requested by Jones that will bring more timely payments and flexibility with some of the deadlines and documentation typically required by insurers.

After such destructive wildfires, policyholders often find many of the things the insurance company needs to process their claim are missing or were destroyed in the fire, such as home inventories and vehicle ownership papers, according to Jones.

Insurance Commissioner Dave Jones views the destruction of the massive Valley Wildfire in Northern California in September. Photo by California Department of Insurance
Insurance Commissioner Dave Jones views the destruction of the massive Valley Wildfire in Northern California in September.
Photo by California Department of Insurance

Under this agreement, policyholders may receive advance payment for up to four months of additional living expenses, 25 percent of policy limits for personal property, and expedite the process for debris removal-a first step in rebuilding.

In addition to the more than 5,000 property claims, more than 1,000 vehicles were damaged or destroyed in the fires, according to the California Department of Insurance. Insurers have also agreed to speed payment for damaged or destroyed vehicles and provide at least 30 days billing leniency for lost renewal notices or those who do not have the ability to have their mail forwarded.

Insurers participating so far in the voluntary policy reforms are:

  • Allstate Insurance Group
  • CSAA Insurance Group (AAA Northern California)
  • Farmers Insurance Group (Including Foremost)
  • Hartford Fire & Casualty Group
  • Liberty Mutual/Safeco
  • State Farm Mutual Group
  • Travelers Group
  • United Services Automobile Association Group (USAA)

“Expediting the insurance claim process is the right thing to do,” Jones said in a statement. “I applaud the effort insurers have made to streamline claim handling and pay consumers quickly, so fire victims may begin to put their lives back together.”

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