Insurers’ incorrect statements to fire victims lead regulator to issue formal notice
News: 2017 Press Release
SACRAMENTO, Calif. — Insurance Commissioner Dave Jones directed the California Department of Insurance to issue a formal notice to insurers, licensed public adjusters and admitted carriers to make sure all claims adjusters assigned to wildfire claims, including those not licensed in California, are properly trained on the California Unfair Practices Act, Fair Claims Settlement Practices Regulations, and all laws relating to property and casualty insurance claims handling.
On October 13, 2017, Commissioner Jones declared an emergency situation in California due to the fires, which allowed insurance companies to use out-of-state adjusters to handle the large volume of claims resulting from the North Bay Fires and other fires. Recently, the commissioner has received feedback from wildfire survivors, public officials, and others that some of the representations made by insurance adjusters conflict with California law.
"Helping residents start the claims process in the face of so many losses and claims necessitated extraordinary actions," said Insurance Commissioner Dave Jones. "While getting claims settled is a priority, it must be done according to the laws in place to protect policyholders through a difficult process. I issued this notice to remind insurers that claims adjusters must be properly trained and process all claims according to California law." Several fire survivors provided examples to the Department of incorrect insurer statements, such as:
Incorrect time frame provided to collect full replacement cost to rebuild. Policyholders were told they have between 6 and 12 months. In a state of emergency, as these fires were, policyholders have no less than 24 months under California law.
Advised that if they decide not to rebuild in the same location, the policyholder could not receive full replacement benefits. Instead, California law provides policyholders may choose to rebuild in the same location, a new location or purchase an already built home in another location.
Told additional living expense benefit would expire in 12 months. Under California law, in a state of emergency, policyholders have up to 24 months.
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For consumers who need assistance or have questions regarding their policy or claim, contact the Department of Insurance hotline at 800-927-4357.
To hear a digitized playback of the press conference, please call 800-475-6701 or 320-365-3844 (International callers) and enter access code: 433967. This playback is available at 1 pm on 11-20-17 and will end 11-27-17.
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.