At its April 8 meeting, the Lafayette City Council will discuss a letter expressing concern over homeowners and fire insurance non-renewals.
If approved, it would authorize the mayor to send a letter of concern to Governor Newsom, Insurance Commissioner Lara, State Senator Glazer and Assembly Member Bauer-Kahan expressing concerns over insurance.
According to the staff report, in March, State Farm announced plans to stop renewing home and apartment insurance policies in California beginning July 2024, a move that will impact 72,000 insurance policies. Locally it appears that State Farm is non-renewing 30-50% of the Homeowners and Rental Dwelling policies in Orinda & Lafayette to reduce their overall catastrophe exposure.
A look at the potential letter:
RE: HOMEOWNERS/FIRE INSURANCE NONRENEWAL CRISIS
Within the last two weeks, we all followed with interest the State Farm announcement that they were not going to renew 72,000 fire insurance policies, or a reported 5% of their total book of business, in California. Since that time, we are now hearing of many specific examples of nonrenewal here in Orinda. The exact extent and scale of that is not yet known to us, and our residents are increasingly concerned and fearful. We are also hearing that efforts to find replacement policies or even to contact and possibly access the State FAIR plan are problematic.
We know this emerging crisis is something you are working to address, but the time for action is now. We in local government are not able to effectuate any changes to how this crisis will play out, however, our residents look to us to add our voices to the call for action.
The City of Orinda and the Moraga Orinda Fire District are leaders in working to make our community more prepared and wildfire safe. We do this in conjunction with local grassroots partners in the form of the Moraga Orinda Firewise Network which is comprised of many individual Firewise Neighborhoods, and the Moraga Orinda Firesafe Council. All these collective efforts are starting to pay dividends but are not being factored into insurance coverage and the cancellations. While our community does have a high percentage of homes in Very High Fire Severity Zones, we do not yet know if that is the reason for the number of cancellations here.
Certainly, a one-size-fits-all approach that has proactive communities being impacted on the same level as those who are not taking steps to reduce risk needs to be addressed. The lack of even basic information as to the scope and scale of the cancellations and the reasons for those is inhibiting proactive policy-making and leaves local elected officials and our residents in the dark. We urge you to focus your attention on this matter and to rise to the aid of those being impacted before they face dire financial consequences, and even in some instances, the possible loss of their homes.
Sincerely yours,
Darlene K. Gee
Mayor
If You Go:
April 8 at 6:30 pm
City of Lafayette
3491 Mt. Diablo Boulevard Lafayette, California
Staff Report – click here
Related
- Jan 23, 2024 – Podcast: Dirk Zeigler On Why California Insurance Rates Are Skyrocketing
- Nov 23, 2023 – Members of Congress Call on Insurance Commissioner Lara to Protect Consumers
- May 30, 2023 – State Farm Stops Home Insurance Sales in California
2 comments
He’s right a one size fits all approach isn’t working. You know the risk when you live in a high fire area..
This has been going on for years in high fire danger zones. The letter that Lafayette has drafted is accurate and well written. I have California Fair Play for Fire insurance, and it is very expensive. With much of California being in these high risk zones, and so many homes insured through California Fair Play, I have to believe that the costs are exorbitant for the ratio of payouts even with the catastrophic fires in the past. More and more homeowners are doing their part to make sure their properties are meeting the fire safe requirements, but see no reduction in insurance costs. There has to be a better way.
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