Insurance commissioner issues 12-month protection for homeowners impacted by Route Fire

The scorched earth left behind after the Route Fire burned through more than 5,000 acres near the Castaic Lake State Recreation Area on Thursday, Sept. 1, 2022.
The scorched earth left behind after the Route Fire burned through more than 5,000 acres near the Castaic Lake State Recreation Area on Thursday, Sept. 1, 2022. Chris Torres/The Signal

Homeowners in 11 ZIP codes in the west side of the Santa Clarita Valley and surrounding areas are protected from being dropped by their insurers for at least the next year, after an announcement Monday by the state’s insurance commissioner. 

Ricardo Lara issued a bulletin to all insurers who write residential property insurance policies in those areas, calling for a 12-month moratorium on policy cancellations and nonrenewals for the areas identified as being impacted by or adjacent to the Route Fire. 

The Route Fire burns above Castaic Lake on Aug. 31. Dan Watson/The Signal

The Route Fire started Aug. 31 near Interstate 5 and Lake Hughes Road in Castaic, and burned 5,208 acres, according to the Department of Forestry and Fire Protection website. 

The action, which was announced as a result of Gov. Gavin Newsom issuing a Nov. 19 emergency declaration, “shields those policyholders within the wildfire perimeter of the Route Fire and in adjacent ZIP codes from insurance nonrenewal or cancellation for one year from the date of the governor’s declaration regardless of whether they suffered a loss,” according to a statement from Lara’s office. 

The affected ZIP codes listed in Lara’s release were 91354, 91355, 91381, 91383, 91384, 91390, 93040, 93222, 93225, 93243 and 93532. It’s expected to impact approximately 52,343 residential fire insurance policies. 

“Devastating wildfires this year have affected thousands of Californians, and the last thing they need is to have to search for new insurance while they are still recovering,” Lara said. “By pushing the pause button on nonrenewals, we will give breathing room to wildfire-scarred communities and homeowners as we all adapt, and continue implementing further solutions to make our communities safer from wildfires and help stabilize the insurance market.” 

Lara’s statement stated the move was “part of a larger solution he is pursuing for consumers and wildfire survivors that includes working to increase insurance protections and market competition to help protect consumers.” 

While the move protects homeowners from having their policies canceled or subject to a nonrenewal notice for the next 12 months, insurers note the cost for a policy will likely increase exponentially once the moratorium ends, and those in the ZIP codes affected could see their policies canceled at the end of the ban. 

“Already this whole area is really hard to write homeowners insurance,” said Sherri Risley, owner of Insure Smart Insurance Agency, noting the fire risk. She added some of those property owners in the affected ZIP codes were fresh off a similar moratorium from a previous fire and previously were subject to policy cancellation. 

“We’ve got people who were nonrenewed that were in Castaic that we had to put in the FAIR Plan, and they’re paying at least triple,” she added. The California FAIR Plan Association was created to meet the needs of homeowners who are unable to find coverage in the traditional market due to potential risks. 

She also mentioned the incident as a reminder for why it’s so important for property owners to make sure their brush is clear and any potential hazards are regularly taken care of on their land. 

The Route Fire left seven injured, destroyed two structures and resulted in hundreds of homes being evacuated, according to CalFire’s website. The blaze burned for five days and was listed as 100% contained on the website’s last update on Sept. 7.  

Los Angeles County Fire Department officials said Monday the cause of the fire is still under investigation, and that no new information was available.  

In response to Lara’s announcement, county Supervisor Kathryn Barger issued a statement praising the move, which is helpful for many in a tough economic climate. 

“Wildfire survivors are often left to fend for themselves with little relief in sight from unforeseen economic burdens, like discontinued homeowners’ insurance policies,” Barger wrote. “Our current tough economic climate is a call to action so that creative solutions are developed to help lift some of that burden. I want to make sure the constituents that I represent are aware of this moratorium and know they can count on this extra layer of support and protection.” 

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