It’s Fire Season: Time to Brush Up on Coverage and Prevention

Take an influx of homeowners moving into what was once open land, add a rainy winter which has fueled the growth of brush and vegetation, and you have a potential recipe for disaster.

As of Aug. 15, close to 300 wildfires were blazing across the West, and nearly 400,000 acres were burning in California, Nevada, Oregon, Arizona, Washington, Texas, Idaho, Montana, Wyoming and Oklahoma. The Associated Press reported that the states hit the hardest were California, with 130,000 acres burning; and Nevada and Oregon, with 110,000 acres burning each.

Structural damage remained minimal: a fire in Washington state burned about 27,000 acres on the Colville Indian Reservation, destroying six homes; and a wildfire was burning close to Monument, Ore., population 150, prompting Gov. John Kitzhaber to declare a “state of conflagration.”

As the summer months heat up across the West, both residents and insurance agents are making sure that fire insurance policies are not just a lot of hot air.

California’s situation differs from other states with its unique California Fair Access to Insurance Requirements (FAIR) Plan, formed by the Legislature more than 30 years ago. That legislation followed the brush fires and riots of the 1960s when some residents in more fire-prone areas had difficulty obtaining coverage. The FAIR Plan presents a standard fire insurance policy to serve both the structure and contents, and is available in certain designated urban, inner city and brush fire areas in the state.

In June, California Insurance Commissioner Harry Low ordered an expansion in the geographic areas eligible for coverage through the Plan. The move extends the Plan to real or personal property at a certain address in cases where the person with an insurable interest in the property has, despite a concerted effort, been unable to receive insurance in the admitted or surplus line market.

According to Mike Harris, director of public affairs for the Fair Plan, “It’s a good sign of a healthy insurance marketplace that other companies are stepping back up to the plate and writing business that traditionally didn’t need the Fair Plan, and that broader coverage is available through the marketplace.”

Forecasts for fire season differ
Harris noted that the recent fires in Riverside County, plus a fair amount of winter rain, increases people’s anxiety about fire season.

“With the advent of technology and more of these fires being shown on television, it makes people a little more aware of the things that could happen,” he said. “Historically, we would say brush fire season is from September through January as a result of the Santa Ana wind condition. With the advent of the urban wildfire interface zones, which means more people have moved farther out in what was once considered one-time rural area, the fire season has definitely expanded.”

Ron Chavez, president of RPD Inc., a general construction and restoration specialist in Mission Valley, feels the state could be in for a rough time in the coming weeks as earlier rain has added to the growth of bushes, shrubs and native vegetation throughout California’s canyons and foothills. “If August gets real dry, we may run into a problem,” Chavez added.

According to Chavez, August is the peak season for fires, although oddly enough, during and right after the Christmas holidays can be bad due to Christmas trees, lights and decorations, and increased furnace use.

However, a report recently released by the University of California, San Diego’s Scripps Institution of Oceanography, indicates that this year’s fire season should fall short of previous years. The report states that the risk is less than average in the majority of California, Oregon, Washington, Nevada and western Arizona. The greatest fire risk is thought to be in the northern Rockies, Colorado and New Mexico.

According to Harris, in the past, homeowners were somewhat complacent because there was nothing close to the major fires seen more recently.

“The mitigation efforts that many of the carriers and the Fair Plan have done will hopefully mitigate the property destruction that we experienced in the early ’90s,” Harris said. “Most carriers have put on some kind of re-inspection program, like the one we started two years ago, where we’re re-inspecting properties on a three-year basis.”

Proactive measures
Chavez emphasized that shake roofs can pose a major fire threat. “The houses that have them are the ones with the greatest risk, and there is a move away from them. There is a fire retardant you can put on them, but it is not very effective. The clay and tile perform very well.”

According to Harris, legislation is pending that would not allow shake roofs on homes at all, which “could be a trend for things to come.”

Along with avoiding shake roofs and trimming brush, another fire-prevention tactic involves the installation of sprinkler systems in homes.

“After the fires of ’93, I sat on the fire marshal’s panel and he was trying to get companies to give credits for persons who had the sprinkler systems,” Harris said. “The downside of that is that unless you had your own water supply, you would take away from the water pressure needed by the fire service. From an insurance standpoint, we experienced situations where in the event a fire breaks out, someone needs to be home to activate them [sprinklers], and you also have the nuisance of kids lighting matches to see if they work. So the water damage issue, from an insurance standpoint, was a concern that some companies…would say offset some of the proactive measures.”

Other protective measures that agents can suggest to their clients include putting the proper ground cover around their house, according to Chavez. Also, “making sure you have a nice, clear firebreak between your house and whatever bush there is around is important.”

The dollar amounts
According to Harris, many of today’s replacement costs are not as prevalent as they were back in the ’90s. “Many of the policies now just offer a limited replacement cost. It is strictly up to the insured to review their coverages every year, hopefully with some guidance from their agent or broker to see if they need more coverage. It is better to not need, than to need and to not have.”

“I think people tend to be a little too aware of the costs and not as aware of the kind of devastation that can happen to their house when they don’t take these preventative measures,” Chavez said. “If you have a policy that isn’t the right policy, a lot of people are underinsured and you run into a situation where you have a fire that can be really devastating. You’re going to have to rebuild up to the current code requirements and a lot of that money is going to come out of people’s pockets.”

The cost of fire damage hurts not only homeowners and insurers but federal agencies as well. Statistics from the national Interagency Fire Center in Idaho showed that suppression costs for federal agencies for 2000 amounted to $1.36 billion, up from $523 million the previous year. The wild land fire season included 827 fires reported across the country, with 8.4 million acres burned and 861 structures burned. In one day alone, there were 86 fires burning at one time.

The average number of fires burned by decade actually showed a decrease over the last 10 years across the nation, going from 163,329 in 1980-89, to 106,306 for 1990-99. The average number of acres burned also dropped from 4.2 million in 1980-89 to 3.6 million in 1990-99.

In figures released by FireSafe.com, the total number of homes lost each year on average to wildfire in California amounts to $163 million. In an effort to minimize those losses, the California Department of Forestry and state and local FireSafe Councils have initiated a statewide program known as “El Fuego” to educate homeowners on how to protect against possible wildfires.

Education, common sense and a little bit of help from Mother Nature will go a long way in determining how much insurers, homeowners and fire prevention agencies will have to pay out this summer.