Protect your home with fire insurance

By: Eliana Sagarin

Where there's smoke, there's fire. Now is the time to protect your home with fire insurance.

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As three separate wildfires rage across Northern and Southern California, almost 50,000 homes are under threat - with potential reconstruction costs climbing to $18 billion. Wildfires, and the damage that comes with them, are becoming a common part of life in certain parts of the United States. Protecting your family and your assets with the proper insurance against fires will keep you safe when you need it the most.

The basics

Fire insurance includes replacing damages to your property—both structures and other assets (such as trees) on your land. Additionally, a homeowners fire insurance policy should cover “Loss of Use”—this provision provides living expenses and rental costs for a specific amount of time if your home is uninhabitable after a fire. Standard homeowners policies cover damage from fire but be sure to read the fine print of your policy. For example, fire insurance for your home could be outlined by price, rather than coverage. Let’s say your house was destroyed in a fire: your insurance might not be obligated to full “Loss of Use” coverage because you had “maxed out” your insurance on the cost of repairing damages.

The bad news

Depending on whether you live in a high-risk area, your homeowners insurance policy might not fully protect your home from fire damages. Unfortunately, some private insurance companies have stopped writing fire insurance policies for California residents altogether. Companies that have provided coverage in the past may not be renewing California policies.

The good news

If you are having a hard time getting fire coverage, the right broker can assess your needs and find the right policy for you. If you can prove you have failed to get enough coverage on the open market, there is the California FAIR Plan. This last-resort insurance covers up to $1.5 million in property damages as the result of fire.
It’s important to be proactive about your coverage. If the worst should ever happen, failing to pay the premium on full fire coverage could mean extraordinary debt in the future.
Fire up your insurance now so you don’t burn out later.