California Insurance Commissioner Ricardo Lara has requested that property insurers provide full personal property coverage limits to policyholders without requiring a detailed inventory of lost items.
The request, which exceeds state requirements, seeks insurer responses by Feb. 28, according to the California Department of Insurance (CDI).
Under a 2018 law, insurers are required to pay at least 30% of a dwelling policy limit, up to $250,000, when a home is declared a total loss and was furnished. Lara is asking insurers to exceed this requirement and offer up to 100% of content limits without an itemized inventory.
According to AM Best, Lara said that homeowners recovering from the state's largest wildfires face numerous challenges, including securing housing, managing construction needs, and addressing family concerns.
Since Jan. 7, more than 30 wildfires have ignited around the Los Angeles metropolitan area.
The CDI has received complaints from policyholders struggling to compile a complete inventory of personal property accumulated over years or decades in order to claim replacement costs.
Lara noted that some insurers have already paid between 75% and 100% of content limits without requiring detailed lists.
Policyholders still have the option to recover the full value of their lost property up to policy limits by submitting an inventory at a later date, according to the CDI.
Lara urged all insurers, including the California FAIR Plan, to align with companies that have already implemented these measures.
“It is inhumane to require wildfire survivors who have lost everything to list every item of personal property in order to receive the full replacement cost under their policies – they need to focus on the larger task of rebuilding their lives,” Lara said.
A few days before the destructive wildfire hit, the state passed a new regulation that orders insurance companies that stopped providing home coverage to hundreds of thousands of Californians to provide policies in fire-prone areas if they want to keep doing business.
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