Many underinsured in CA

Survivors of last fall’s devastating Southern California wildfires and state officials gathered at the state capitol last Monday to announce their goal of passing a “Homeowners Bill of Rights.”

BY HEATHER MOYER | SACRAMENTO, Calif. | May 4, 2004



"The problems must be addressed and we will be holding insurance companies accountable up to the full impact of the law."

—John Garamendi


Survivors of last fall’s devastating Southern California wildfires and state officials gathered at the state capitol Monday to announce their goal of passing a “Homeowners Bill of Rights.”

California Insurance Commissioner John Garamendi says the four bills that make up the Homeowners Bill of Rights would provide immediate assistance to many survivors of the wildfires.

This move also comes on the heels of Garamendi’s launching a special investigation team that will look into claims from many wildfire survivors that their insurance companies did not make home replacement policies clear.

Many survivors have not gotten payouts that would equal the costs of rebuilding their homes, causing confusion among those who had policies listed as “replacement policies.”

“I thought ‘replacement’ meant ‘replacement,’” said Karen Reimus, whose San Diego home completely burned last fall. “Yet I was underinsured by over $149,000."

Reimus joined other survivors at the state capitol to add their support to the bills even though they will not receive any retroactive benefits from them. “We came up here to try to help those who come after us – we want to prevent this from happening to anyone else,” she said. “That’s why these bills are so important. If they’d already been in place, this wouldn’t have happened to us.”

Reimus said the bills will make insurance policies clearer and help consumers make an informed decision about all the different existing policies. “The bills will also make it known to people that replacement policies are not enough insurance,” said Reimus.

The California Department of Insurance has held four community town hall meetings in the last three weeks, and Garamendi said the thousands of people who attended those meetings made it very apparent that extraordinary problems are facing the survivors when it comes to insurance policies.

“The problems must be addressed and we will be holding insurance companies accountable up to the full impact of the law,” said Garamendi.

The Association of California Insurance Companies (ACIC) responded to the charges made by Garamendi and yesterday’s announcements. “We deeply sympathize with the victims of last year’s devastating firestorms in Southern California. Insurance companies immediately responded to the plight of their customers by establishing assistance centers in burned-out areas even as fires still raged. Insurers ever since have been working closely with their customers in the recovery process,” said ACIC president Sam Sorich in a news release.

“Insurers, in fact, are doing the best they can to help their customers through this difficult time. After all, insurers are in business to provide a service and to keep their customers as satisfied as possible.”

Sorich laid some of the blame at Garamendi’s and the Department of Insurance’s door, saying neither did enough to educate consumers about insurance policies.

To date, the Department of Insurance has helped secure $3.1 million for fire survivors who filed complaints against insurer practices.


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More links on Wildfires

 

Related Links:

News Release from the California Department of Insurance Communications

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