Wildfire Homeowner Insurance Claims

ICON: Total Loss

Although a total loss is devastating, it often simplifies the claims process, which is a small blessing.

When your property is damaged beyond repair, it will be considered a total loss. This means that your insurance company will be responsible for reimbursing you an amount equivalent to your property’s value or your policy’s limits, depending on your policy type. 

ICON: Partial Loss

A partial loss is less clear-cut and requires more investigation than a total loss. 

A partial loss refers to damage affecting only part of your property requiring repairs rather than a complete rebuild. For example, if your home sustains heat and smoke damage but its structure remains sound, the damage may not be as obvious and may be easier for the carrier to dispute.

ICON: Replacement Cost Value

Replacement Cost Value policies are usually more favorable for policyholders as they consider current prices.

RCV policies allow for the replacement of damaged property. Your carrier determines this by comparing current market prices for building materials and content items. This type of policy may require you cover the cost of repairs and submit receipts for reimbursement, however, it usually results in higher payouts.

ICON: Actual Cash Value

Actual Cash Value policies mean that depreciation will be taken from your claim value, lowering your settlement.

ACV policies only require your insurance carrier to value your claim settlement based on the depreciated value of your property at the time of its loss. These policies typically have lower payouts than RCV policies because insurance carriers subtract value depending on how old the property is, and other factors. 

California Residents Cope with Wildfire Property Damage

According to data from the National Interagency Fire Center, California has the most wildfires and acres burned of any state in the country.  In 2023 alone, the Insurance Information Institute reports that California saw 7,364 wildfires and 332,722 acres burned. Additionally, in 2024 there were 1,258,748 housing units deemed at risk for extreme wildfires in the state.

With the frequency of extreme wildfires increasing year after year, more property owners in California can expect to submit an insurance claim for fire damage each season. 

Important Wildfire Claim Deadlines to Know

If you’re policyholder with a California wildfire claim, knowing state insurance compliance deadlines can help hold your insurance carrier accountable and ensure a more timely resolution to your claim. Here are the major claim deadlines to keep on your radar:

  • Insurers must acknowledge receipt of a claim and provide the necessary claim forms or instructions within 15 days.
  • Insurers are legally obligated to accept or deny a claim within 40 days after receiving all necessary documentation.
  • If the claim investigation is ongoing, the insurer must provide written updates to the claimant every 30 days.
  • The insurer must issue payment promptly, within 30 days after the claim is approved.

Carriers are inundated with claims during wildfire season, but they are still responsible for giving policyholders fair treatment, especially during such a traumatizing experience. Many people cannot afford to begin repairs until they receive their insurance settlement, so their ability to rebuild hinges on the timely resolution of their wildfire claim. 

Support for Policyholders

Although California has mandatory wildfire insurance requirements, few people fully understand their policies. If you have urgent questions about your insurance policy or need guidance after being impacted by a California wildfire, you can call the California Department of Insurance Consumer Hotline at 800-927-HELP, or consider hiring a licensed Public Adjuster to assist. 

INFOGRAPHIC: Value of a Public Adjuster