State Negotiates Deal for Sayre Fire Victims

Mobile home owners whose properties were destroyed by the 2008 Sayre
Fire and who were insured by AIG will receive as much as an extra
$125,000 from their policy under an agreement announced today by the
state insurance commissioner.
The Sylmar-area fire destroyed 485 mobile homes, 370 of which were
insured by American International Group Inc.
Those policies included a stipulation that home owners would receive
additional compensation if their homes were destroyed, but policyholders
found that what they were provided with was insufficient to replace
their mobile homes, according to the Department of Insurance.
The DOI negotiated a deal with AIG — worth up to $46 million – to
provide owners with an additional $100,000 to $125,000 per policy.
“Losing your home and all your belongings in a wildfire is absolutely
devastating,” said Insurance Commissioner Steve Poizner. “After years of
making payments on their policies, homeowners count on their insurance
companies to come through when they need them most — when they lose
The State got involved after receiving complaints from fire survivors
who complained that their AIG policies included a stipulation that
provides either 110 percent or 125 percent for additional coverage in
the event of a total loss. However, the company advised the
policyholders that the 110 percent enumerated in their policies actually
meant 10 percent additional coverage, and 125 percent actually meant 25
percent additional coverage for policyholders. As many wildfire victims
attempted to rebuild their lives, they found that the policy limits
being offered by AIG were insufficient to replace their mobile homes.
DOI took the position that coverage should be afforded for 110 percent
or 125 percent of additional coverage and urged AIG to offer the higher
policy limits to all wildfire victims.
“We commend the Commissioner and his team for negotiating this important
agreement on behalf of the hundreds of AIG policyholders who lost their
Sylmar homes and need every promised dollar of insurance coverage to
rebuild,” said Amy Bach, a consumer rights advocate and executive
director of United Policyholders in a press release from the DOI.
During a meeting with fire victims at Olive View Middle School earlier
this week, Los Angeles City Councilmember Richard Alarcón called the
deal “an amazing accomplishment”.
“I want to thank the local disaster recovery advocates who brought this
to the attention of my office so we could work with the Insurance
Commissioner to ensure that the Oakridge residents received what they
were entitled to and I thank the Insurance Commissioner for following
through,” said Alarcon in a press release.