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Finding home insurance in fire-prone areas can be tricky, and even more so. Some insurance companies are canceling or simply not renewing policies in West Coast fire-prone areas. Home insurance is increasingly difficult to find, but you don’t want to be caught without it and on the hook for hundreds of thousands of dollars in repair, rebuild and replacement costs.
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There are some options for homeowners who can’t use a typical high-end home insurance provider because of their area, and the This Old House review team has put together options that are available to you when standard insurance isn’t available. Additional liners are an option, and homes worth more than $1 million may qualify for AIG or Chubb coverage. As a last resort, homeowners can turn to their state’s insurance safety net.
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Unfortunately, the options are few and far between and usually more expensive than traditional home insurance. But to protect your biggest investment, it might be worth it.
Home insurance companies usually cover fire damage. Most home insurance companies will help you cover the cost of repairing or renovating your home, the cost of replacing your personal possessions, and the cost of temporary housing if your home is destroyed by arson, electrical problems, or a forest fire.
Homeowners living in fire-prone areas do not always have standard home insurance due to the high risk. Fortunately, there are alternatives.
The record-breaking forest fires of recent years have inspired home insurance companies to reconsider the risks of insuring homes in fire-prone areas. Many traditional carriers refuse to insure properties in these areas, while others have stopped renewing policies. Insurers don’t want liability, and dry seasons are getting longer while wet seasons are getting shorter. The Institute of Insurance Information notes that wildfires caused $18 billion in insured losses in 2018, up from $15 billion the previous year.
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According to Verisk’s 2019 wildfire risk analysis, 4.5 million American homes were found to be at “high” or “extreme” wildfire risk. Data from the National Interagency Fire Center show that 41,051 fires occurred from January 1 to September 8, 2020, compared to 35,386 fires during the same period in 2019.
There are several ways to insure your home in a fire-prone area if standard home insurance isn’t an option.
Most states offer FAIR plans, or fair access to insurance claims, as a last resort. In California, the FAIR plan covers up to approximately $1.5 million in home and personal property coverage.
Unfortunately, FAIR plans do not cover other risks such as water damage, theft or vandalism. Sickness payments and personal liability are usually not covered by the insurance. Homeowners can supplement their coverage by purchasing a Gap Policy to ensure there are no gaps in coverage.
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FAIR plans tend to be expensive and can cost double the premium of a standard home insurance policy. However, other options can be even more expensive.
Major insurance companies like AIG and Chubb have home insurance plans designed to handle fire damage, including private fire department services. Unfortunately, this type of home insurance is usually only available for homes valued at over $1 million.
Over the counter carriers insure homes that typical home insurance companies refuse to insure because of the high financial risk. They are able to take risks because they don’t have to follow government regulations. Plans from excess line companies tend to be more expensive than standard home insurance.
Fires can be absolutely devastating. However, there are some steps you can take to try to mitigate the damage if you live in a fire-prone area:
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If you qualify, you can get high-risk home insurance from your state’s government-run FAIR plan. This home insurance policy works as a last resort. You can also search for the best high risk home insurance companies near you.
Most homeowner’s policies cover fire as a listed peril, meaning they help cover the cost of repairing or rebuilding the home’s structure, the cost of replacing damaged or destroyed personal property, and the cost of temporarily living away from home, including fuel. , accommodation and meals.
Many of the West Coast’s fire-prone areas, especially in California, are not covered by most major homeowner’s insurance policies.
Homeowners living in high-risk areas such as California may need to purchase additional insurance to cover fire damage.
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If you’d like to provide feedback or ask a question about this product, please send a note to our review team at If you live in Connecticut, you’ve probably received letters from several companies warning you that if your service line goes out, you’ll have to pay out of pocket. To prevent this potential financial burden, each of these warning letters includes a solution: service line insurance.
To be clear: Service line coverage is not a scam. If you’ve heard otherwise, the information probably came from someone who is simply wrong.
Service line insurance covers the repair or replacement of service lines running from the main connection point to the main service line of your home.
Now you might be thinking: If my service line goes down, can’t I just tell the utility company to fix it?
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Most homeowners know who their service providers are. If you live in Connecticut, you might get water from Aquarion, power from Interface, gas from Southern Connecticut Gas, and cable from Optimum.
However, many people do not realize that homeowners own the portion of the service line that runs from the main interchange to their home.
These lines are called power lines, and if they break, the power companies are not responsible for fixing them. instead, utility companies have the right to suspend service until it is repaired, depending on the severity of the outage.
For example, if a large stream of water begins to engulf your yard, there is a good chance that there is a leak in the service line.
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If the break is serious enough, the water company will require you to repair it within 1-2 weeks. If you don’t fix it within the set time, they usually close it.
Why? Because even if you own a service line, a major outage can drain the system your neighbors get their water from.
Repairing or replacing a broken service line is usually no small job. To repair or replace it, the line must be dug up; and when the work is done, you typically receive a bill for thousands of dollars!
It is important to remember that the interface insurance only covers the cables if they break. Contrary to popular belief, service line insurance does not cover maintenance. For example, if your water or sewer line freezes, your utility line policy will not cover the costs of thawing the plumber. however, you are covered if it breaks due to freezing.
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Now that you understand what service insurance covers and why it’s important to get one, you might be wondering:
While your service may be covered under your own policy, in most cases it is not. However, be sure to check your homeowner’s policy before purchasing a separate policy for power lines.
If you are interested in getting a home insurance quote that includes a service line, give us a call. We want you to be fully protected against unexpected service line interruptions. Don’t wait until it’s too late: contact us today! By June Sham By June ShamArrow Right Former Writer, Insurance June Sham is a former insurance writer at the magazine. Prior to joining the team, he spent nearly three years as a licensed producer writing auto, real estate, umbrella and earthquake policies. June Sham
Maggie Kempken Maggie KempkenArrow Right Senior Editor, Insurance Maggie Kempken is an insurance editor. Help manage the creation of insurance content that meets the highest quality standards for accuracy and clarity and helps readers navigate complex home, auto and life insurance information. It is also committed to ensuring that insurance content represents and adheres to the brand. Maggie Kempken
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