Why Am I Being Non-Renewed or Canceled Due to Fire Risk (Distance to Brush)?
Wildfire seasons in California have become more severe and unpredictable, resulting in stricter guidelines from insurance companies.
Some insurers are losing money due to wildfire losses and are adjusting their policies and coverage options accordingly.
If you’re struggling to find coverage, working with a broker like Wang Insurance can help you explore all available options, ensuring you find the right balance of cost and protection.
If you’ve recently purchased a new home and are struggling to find insurance, or if you’ve received a non-renewal notice from your current insurance company, you may be confused or shocked. Why are you suddenly being non-renewed?
This article covers:
Some Background
California’s wildfire risk has drastically changed in recent years. Starting with the severe 2012 drought, insurance companies began tightening their wildfire risk guidelines. The industry suffered over $20 billion in losses during the 2017 and 2018 wildfire seasons alone, more than twice its total profits since 1991.
The 2017 Tubbs Fire in Santa Rosa was a turning point—it destroyed homes in areas not previously considered fire-prone. Since then, wildfire seasons have been longer, more destructive, and more frequent. This forced many insurance carriers to exit the California homeowners market or request rate increases from the California Department of Insurance (CDI). In response, carriers have adopted more stringent underwriting rules, including the use of “brush maps” and wind pattern assessments to evaluate fire risk.
Before these extreme events, the California homeowners insurance market offered plenty of options, allowing consumers to compare prices from multiple carriers. Today, in areas newly mapped as “higher brush” zones, finding even one insurance company willing to offer coverage can be challenging.
If you’ve received a non-renewal notice or are having trouble finding property insurance, you’re not alone. Here are a few options our agency can help you explore:
Preferred Carriers: We represent dozens of insurance companies and will check your property against each carrier’s brush maps to see if a preferred option is available.
Surplus Lines/Non-Admitted Carriers: If preferred carriers decline to underwrite your property, we may be able to offer a surplus lines or “non-admitted” policy, which provides coverage when traditional carriers will not.
California FAIR Plan and “Difference in Conditions” Policy: As a last resort, the California FAIR Plan is an option for high-risk homes. Although it offers only basic coverage (and excludes things like water damage or liability), it can be paired with a “Difference in Conditions” or “Wrap” policy to provide additional protection.
Here’s a breakdown of the four primary insurance marketplaces you may encounter:
Preferred Carriers: These are the well-known companies you see in TV or online ads. They generally offer the best coverage and pricing, along with discounts like bundling. If you qualify, preferred carriers provide the best value.
Specialty Carriers: These companies cater to unique property uses, such as short-term rentals (Airbnb, VRBO) or vacation homes. They are often available through brokers like Wang Insurance.
Surplus Lines/Non-Admitted Carriers: These companies provide coverage when traditional carriers won’t. You’ll need a broker to access these policies, as they aren’t available directly to consumers.
California FAIR Plan: This is a “last resort” option for homes in high-risk areas. While it offers basic coverage, it lacks protection for water damage and liability, which must be purchased separately. Some preferred and specialty carriers partner with the FAIR Plan to create “Wrap” policies, which enhance coverage for wildfire-prone properties.
If you need assistance navigating the complexities of fire risk and insurance, contact us at Wang Insurance. We’re here to help you secure the best coverage available for your home.