Wildfire victims demand help fighting insurance companies

Homeowners’ policies not covering costs of rebuilding
This story has been modified since its original posting.

RANCHO BERNARDO —- Stan Newman and about two dozen others who lost
their homes in last year’s Witch Creek fire complained Wednesday they
had made almost no progress toward rebuilding because their insurance
companies were refusing to cover all the costs.
Only after their homes were destroyed did many of them learn they
hadn’t purchased enough insurance to cover the cost of rebuilding,
Newman and others said. The homeowners said agents misled them, telling
them their policies would cover a total loss.
Sam Sorich, president of the Association of California Insurance
Companies, which represents about 40 percent of California insurers,
said Wednesday there is no evidence of a widespread underinsurance
problem.
When underinsurance occurs, he said, it is more often because
homeowners inaccurately describe their home to an agent than because of
misrepresentation.
Only about 100 of the 1,600 houses destroyed in last year’s
wildfires have been rebuilt as of late August 2008, according to a
recent report by the San Diego Regional Disaster Board. Most who lost
their homes were underinsured, and the most common reason for delays in
rebuilding were protracted negotiations with insurance companies, the
report found.
State Insurance Commissioner Steve Poizner on Wednesday encouraged
any homeowner who is having problems with an insurer to file a
complaint with the state Department of Insurance.
“We are on the lookout for any type of misrepresentation from the
insurance companies, intentional or unintentional,” Poizner said.
He urged them to contact the California Department of Insurance at
800) 927-HELP or online at www.insurance.ca.gov.