Homeowners in Los Angeles County impacted by recent wildfires can breathe a little easier, after state Insurance Commissioner Ricardo Lara issued an order that bars insurance companies from canceling or non-renewing homeowner’s policies in wildfire-affected areas for at least one year.
He also ordered insurance companies to make advance payments to policyholders who had their homes damaged or destroyed by the fires, in order to help them get back on their feet.
The moves should provide some peace of mind as those affected by the fires grapple with trying to find housing and working with their insurers to start the rebuilding process.
What the moratorium means for homeowners
The moratorium shields homeowners whose properties are located in any ZIP Code within or adjacent to the fire perimeter of the Los Angeles wildfires, including the Palisades, Eaton, Hurst, Lidia, Sunset and Woodley fires. Even residents who didn’t lose their homes are protected.
You can find a full list of all affected ZIP Codes in this document.
Under California law, insurance companies cannot cancel or non-renew policies in these zones for one year after the state of emergency declaration made by Governor Gavin Newsom on Jan. 7.
For those whose homes suffered a total loss, insurers are required to renew policies for at least two years.
Additionally, Commissioner Lara has paused pending cancellations and non-renewals issued within 90 days before the fires started. This six-month pause gives affected homeowners the opportunity to focus on recovery and rebuilding without the added stress of losing their insurance.
Advance payments
He also ordered insurers to make advance payments on claims for survivors of the Los Angeles wildfires. This is intended to expedite recovery efforts and help families get back on their feet.
Under California law, insurers must offer advance payments for personal property losses and living expenses to policyholders who experience a total loss due to a wildfire. Specifically:
- Insurers are required to pay at least 30% of a policy’s dwelling limit upfront for personal belongings, up to $250,000, without requiring a detailed itemized list.
- Policyholders are entitled to at least four months of advance payments for additional living expenses, such as temporary housing.
For those who are rebuilding their homes or relocating, current laws also guarantee full benefits for replacement costs, including building code upgrades. Lara’s directive reaffirms these protections and calls on insurers to go beyond minimum legal requirements to support wildfire victims.
What to do if you receive a cancellation notice
While the moratorium provides critical protection, some homeowners may still face challenges. If you receive a cancellation or non-renewal notice, here are steps you can take:
- Contact your insurance agent or broker:They can help explain the notice and verify whether your home is in an affected ZIP code protected by the moratorium.
- Call the California Department of Insurance: Reach out at 800-927-4357 or visit their website for assistance if you believe your insurer is violating the moratorium.
- Explore alternative coverage options: If you are still unable to secure coverage, call us. We can look for alternative coverage with other carriers. As a last resort, the California FAIR Plan is required to take all-comers.