This year — and in the last decade — wildfire home and business losses have stretched from millions of dollars to billions. In California larger insurance companies have stopped writing homeowners policies on people whose homes and businesses are in high risk areas.
It will — no doubt — soon be a trend seen in other now fire prone states like Oregon, Washington, Idaho and Montana.
In California Allstate stopped writing homeowners policies completely in 2007. Farmers and State Farm in the last few years have also become much more discriminating about what they’ll write.
The impact has been huge for the two-million households considered high risk. But to counter, the state has put together a consortium of companies to provide coverage. It’s very expensive and doesn’t cover as much as the traditional policy.
Homeowners unable to get homeowners insurance have soundly ignored the program. Instead they’re picking up less-traditional policies from companies known for insuring unusual risks like kidnapping or rare art collections.
It’s expensive but more comprehensive than what is offered by the state.
These companies are: Nationwide Mutual’s Scottsdale Insurance Company, Foremost — one of Farmers Exchanges’ firms, Lloyd’s of London, Lexington and others. They wrote 23,120 policies in the Golden State alone in 2014. That’s a 91% increase over previous years said the Surplus Lines Association of California.
Source link: Insurance Business America