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The devastating wildfires in California last year are putting more homeowners in harm’s way as insurers are raising rates and canceling the coverage of some customers.
Insurer AAA has announced it will not renew less than 1 percent of its current homeowners’ policies but will try to help place coverage elsewhere, according to reports.
California insurance commissioner Ricardo Lara recently announced estimates from just the November 2018 wildfires that destroyed the towns of Paradise, Redding, and Malibu had risen to $11.4 billion while total losses from more than 8,000 blazes across the Golden State exceeded $18 billion last year.
The steep insured losses mean the “current course of market contraction” will not change, according to insurance trade groups.
So how much will rates rise?
Neither the California Department of Insurance (CDI) nor the Insurance Information Institute (III), which represents property insurers nationwide, can say at this point.
However, if a December 2017 report from the CDI could provide an indication, those who previously paid $800 a year for a policy could now be charged up to $5,000.
III spokesperson Janet Ruiz advises homeowners to shop around for coverage.
“I refer people to insurance brokers who are local and know which companies are offering insurance in high-risk areas,” Ruiz told CBS News.
Read about other insurance options if a regular insurer will not cover your home at cbsnews.com.