8 steps for homeowners when your property is destroyed by wildfire

As some of the smoke began to clear across parts of Southern California this weekend, the toll from several large wildfires became more visible. How much 10,000 homes and other structures have burned since last week, leaving behind massive devastation that spanned entire neighborhoods in the Los Angeles area.

If your home has been destroyed or damaged by a wildfire, here’s what you need to know about the insurance claims process, your rights as a homeowner, and how to prepare for what comes next.

Read more: How to protect yourself from smoke during California wildfires

What to do if your home is destroyed or damaged

Once you and your family are safe and the damage to your home can be assessed, you will need to call your insurance company to begin the claims process. As this process can take months, it is important to contact the company as soon as possible.

If your home has been completely destroyed and a state of emergency has been declared, your insurance company is required by law to issue a minimum payment in advance even if the adjuster has not seen your property. This includes one-third of the replacement value of your personal belongings and a minimum of four months’ rent for the area.

Carefully review your homeowners or renters insurance policy, including your limits. Start documenting and creating a paper trail to support your claims process. If you have photos of your property and vehicles before the fire, you can use them to supplement yours home inventory if you haven’t already sent one.

After verifying that your home is habitable, documenting the damage, and starting the insurance claims process, contact your mortgage lender or landlord for next steps.

Overwhelmed? California residents can find resources and a helpline for filing a bushfire insurance claim here.

Forest fire damage may or may not be covered by insurance

Depending on your policy, where you live and the coverage you pay for, your homeowners (or renters) insurance may or may not cover damage to your home or belongings caused by a wildfire.

Fire is usually a “covered peril” in most cases home owners insurance policies unless your policy specifically states a bushfire exclusion or you have been excluded from or denied cover.

In some areas prone to wildfires, home insurance policies are priced higher or require a separate deductible for wildfire claims. If you live in a home considered high risk where you cannot get traditional home insurance, FAIR Plan (Fair Access to Insurance Claims). can provide basic fire insurance.

Read more: Fires in Los Angeles County: FEMA assistance now available. Here’s how to apply

How to file a bushfire claim in 8 steps

It’s natural to feel devastated when a natural disaster turns your life upside down. Here’s what homeowners can do after a partial or total loss due to a wildfire.

Step 1: Call your insurance company

Once you reach safety, start the claims process to get an initial payment to cover your living expenses for a few months. When planning for the long term, be sure to factor in your deductible.

Step 2: Damage inventory

If you can, photograph and detail the damage to your home, vehicles and personal belongings. If you have not yet completed a home inventory for insurance purposes, work with a trusted friend or family member to detail and list appliances, furniture, electronics, decor and other equipment along with brand name and approximate purchase price.

Step 3: Review your policy carefully

Review your home insurance or renters policy, its coverage limits, and what benefits you are entitled to for reimbursement of personal belongings and living expenses. Insurance companies are required to provide you with this information upon request.

A typical homeowners insurance policy includes coverage for rebuilding or replacing the structure of your home and detached structures such as garages, as well as coverage up to a certain limit for personal items in the home. Most policies also offer liability protection and additional living expense (ALE) coverage.

Step 4: Keep your receipts

Pay close attention to your ALE limits to cover hotel or rent bills, restaurant meals, and other expenses you may incur while your home is being renovated or remodeled. If your home is destroyed and needs to be rebuilt, you can expect a minimum of a year or more of additional living expenses.

Step 5: Watch out for fraud

During a major disaster, it can be easy to get caught up in rumors or misled frauds. Your neighbor’s insurance policy or company may be different, so work only with your insurance company, he says Janet RuizCalifornia-based representative of the non-profit organization Insurance Information Institute. Fraud is common. “Unlicensed contractors, unlicensed public adjusters often prey on those who have suffered a loss,” Ruiz said.

Step 6: Document everything

Create a claims folder where you can keep notes, records and details of every interaction you have with your insurance company, mortgage company and more. The claims process can be lengthy and you may need to secure multiple quotes and work directly with contractors.

Step 7: Don’t accept an unfair offer

Working with your claims adjuster is a negotiation process. If the first settlement offer does not fully account for the cost of repairs or reconstruction, you can issue a demand letter demanding additional payments that are more in line with your coverage limits and the value of your home.

“Often homeowners are defensive or don’t ask enough questions of the claims adjuster. If you don’t get answers, ask for a supervisor,” Ruiz said.

Step 8: Get professional help if needed

If you are not sure if your home insurance company is treating you fairly, many states provide resources to help with the claims process. You can also seek mediation or hire an attorney as a last resort to settle a disputed claim.

What to do if your insurer refuses bushfire cover

Most states require insurers to notify homeowners of policy cancellations months in advance of the expiration date. Ruiz said that if you are denied coverage, it is important to find a policy with another insurance company and that California FAIR Plan takes all insurable homes.

California Insurance Commissioner Ricardo Lara issued a mandatory one-year moratorium regarding non-renewal and cancellation of insurance. Those in certain zip codes affected by the Southern California wildfires cannot have their homeowner’s policies canceled for a year, regardless of whether they suffered a loss.

If the fire was part of a federally declared disaster, the Federal Emergency Management Agency (FEMA) will provide some support for both insured and uninsured homeowners. California homeowners and others affected by the Los Angeles wildfires you can apply for FEMA assistance here.

What you need to know about your mortgage after wildfire destruction

Even if your home is a total loss or deemed uninhabitable, you’re still on the hook for the remainder of your mortgage. Contact your creditor immediately to see if you qualify for a forbearance or deferred payment while your claim is processed.

Some lenders may be willing to delay payments for three months to a year pending insurance payout. This is critical to protecting your credit score, as late or missing mortgage payments would otherwise be considered delinquent and affect your credit score.

How to protect your home from future wildfires

As forest fires become more prevalent in every part of the country, many people are taking steps against them protect their homes. some countries like Californiahave federal, state and local programs to help homeowners reduce fire risk by retrofitting and strengthening their property to protect against wildfires.

Home insurance companies may also offer incentives for taking certain measures, such as installing sprinklers, creating a secure perimeter on your property, and upgrading your home with fire-resistant materials.