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California Insurers Brace For Fire Damage Claims

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By Neetal Parekh on September 01, 2009 10:05 AM

A wildfire that has engulfed 80 homes with thousands more in its path is still blazing with ferocity in Southern California.  As of today 6,600 homes in the Los Angeles foothills were evacuated under mandatory orders.   And the fire more than doubled on this, its sixth day, claiming the lives of two local firefighters.

And the heat is on for insurance companies too.  Travelers Cos., Farmers Insurance Group, and Nationwide have already mobilized catastrophe teams to assess the initial damage.

The wildfire insurance carriers in Southern California feel relatively prepared for the claim filings, having weathered over half-a-dozen wildfires in the past two decades.  Since 1990, 7 California wildfires have instigated $6 billion in insured losses.  And that doesn't account for the millions of acres that have been scorched as well as the thousands of homes that have been gutted by flames.

Insurance companies report that a number of claims have already been filed from fire damages sustained in Auburn, a northern California city that was the scene of a wildfire on Sunday.

And, displaced families may be eligible for coverage of evacuation and temporary housing fees.  California state law requires that living expense coverage be provided for 24 months following a declared state of emergency, as reported by the Insurance Information Network of California (IINC), a non-profit trade association dedicated to assisting the public in managing risk and utilizing insurance.

The IINC suggests that policyholders who have been displaced immediately contact their insurers regarding additional living expense coverage provided for in their policies.

 

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