Thursday, November 23, 2017

Cost of Wildfires

Wildfires are not new to California, and most residents take the risk as a fact of life. What is worrying, however, is the increasing amount of damage and financial losses that these disasters cause. This year the California Department of Insurance has made a preliminary estimate that the insured wildfire losses are in the region of $1.05 billion. This number is based on claims received from the largest insurers in the state and is expected to rise. As of mid-October insurers have received 601 property loss claims, 4177 claims for partial residential losses and 3000 claims for auto losses.

Since the fires began on October 8th, over 250,000 acres have been burnt black, and almost 7,000 structures which includes homes, commercial establishments and wineries, have been destroyed. Over 15,000 people were displaced.

Cost to Families

These numbers are bad and with climate change expected to increase the risk of fire in the future, the dangers will only surge. It makes sense to take steps to protect your home from fire damage and loss, but there is never going to be a 100% certainty that you are safe. A home directly in the path of a wildfire will be destroyed. That is why along with protection it is important to also plan for recovery after major damage or complete loss of your home.

Losing a home is not just a physical and financial loss, it is an emotional one too and with all these factors put together, the devastation that a family will suffer is huge and will affect their lives, and often their futures, for years to come. Nothing can make up for the loss of a home, but having the right insurance coverage will speed the recovery and rebuilding of lives.

Path to Recovery

The federal and state aid that is made available after natural disasters are meant only to help those affected, survive. It is not for recovery and rebuilding lives that requires insurance.That’s what, those who have suffered losses because of the wildfires will be depending on. However, in many cases, the coverage may not be enough to allow complete recovery. If there are savings available, it could help make up the shortfall. But savings are created for a specific purpose and to use those resources to rebuild a home will mean that other important objectives must be sacrificed. If there isn’t enough in the form of savings to make up the insurance coverage shortfall, then what? The family’s future will be damaged and in the worst case, ruined.

Check Your Coverage

Underestimating insurance needs is easy. The value of a home will change over time and so too will the possessions that the family accumulates. What was an adequate coverage a couple of years ago may no longer be so, now. That is why it is essential to regularly review your insurance coverage and ensure that what you have is enough to help your family recover if your home should be lost.

All that it takes is a call to an insurance broker who will be able to review your existing coverage, your actual insurance needs s and then help you to cover the gap, if it should exist.

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