Fire, Flood & Earthquake: Are You Insured?

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Real Estate

As Californians, many of us have adapted to a fire and flood season lifestyle and take earthquakes in stride. But does your property insurer have a laid-back California attitude?

I recently revisited my homeowner’s policies after watching the number clients struggle to secure adequate insurance rise more during the last year than I've seen in the last ten. The number of fire disasters and near miss floods we’ve seen was also inspiring. The meeting was an enlightening experience and I’ll share my feedback on each policy.

Flood: You may not think you need flood insurance simply because your lender doesn’t require it. In California, a Natural Hazard Disclosure report, which is easily and affordably obtained, will often reveal if your property is in a dam inundation zone such as my Sacramento County properties are (Folsom Dam). While my lenders do not require flood insurance, I opted in as my primary residence is near a levee plus I have my concerns not about Folsom, but rather Oroville Dam (a topic I’ll discuss in more detail in a different blog post).

Fire: Get it while it’s hot, pun intended. Why? Insurers are dropping California fire policy holders daily due to high wildfire risk statewide so if you don’t already have a solid fire policy in place get one while you still can. As I referenced before, I’ve seen the number of homeowners dropped from fire insurance and the number of buyers struggling to obtain fire insurance rise more in the last year than the last ten.

Earthquake: This one surprised me. My long-time insurance agent said, “don’t bother,” further explaining that there aren’t enough folks buying earthquake insurance and paying into the fund so when the big one hits and claims are made, there won’t be enough money to pay claims out. His earthquake message, fed to me from a desk full of still-unresolved wildfire claims, was a bleak one: the insurance industry is not prepared for California’s Biggie.

I was reminded that, just like in a real estate transaction, a trusted insurance agent is required when obtaining the right policy to protect your investment. Start point questions for policy seekers should include what kind of coverage, how much coverage, expense of coverage and what to expect when making a claim.

If you have a similar or, better yet, a very different experience or more insight on the subject I would LOVE to hear from you!

If you would like an insurance agent referral, please contact me for one in your area.

Stay safe and insured!