The California Department of Insurance has just released its 2023 Annual Notice of Key Homeowners Insurance Laws. The notice begins with the following introduction, which warns insurers that they must provide the notice to claimants suffering from a declared state of emergency:
The California Department of Insurance (CDI) is required to prepare and deliver to admitted insurers and licensed insurance adjusters an annual notice describing the key California laws relating to property insurance, including those related to a declared state of emergency (California Insurance Code [Cal. Ins. Code section 1
4046[a][1]). The 2023 Annual Notice is in a new format and is available in the “Education” section of CDI’s Insurance Adjustment Claims webpage. CDI may also issue interim updates if significant legislative changes occur during the course of this year. These updates will also be available on CDI’s website.Since at least 2007, following major fires, CDI has been distributing notices to insurers, agents/brokers and adjusters regarding significant California laws pertaining to home insurance. These notices focus on wildfire claims and can be found on CDI’s Wildfire Resources webpage.
For claims under a home insurance policy that arise as a result of a declared state of emergency, each home insurance company is required to provide the applicant with a copy of this or the most recent notice no later than 15 calendar days from the day on which the insurer received notice of the claim. It is expected that all home insurance companies and insurance adjusters will comply with the following laws for residential property insurance claims related to a state of emergency…
Property insurance codes and regulations in California are generally stricter than other states and apply specifically to how adjusters evaluate damage claims. The annual communication covers many points, including:
- Actual cash value calculation
- Calculation of replacement cost value
- Time limit to collect full RCV benefits
- Rebuilding at a new location
- No land value deduction for replacement building
- List of covered items for ALE
- Time limit for ALE to 36 months
- Restricted Area ALE Mandatory
- Specifying Content – No Business Forms
- Restrictions on replacement of claims adjuster
- Evaluation – not mandatory after disaster
- Free copy of policy within 30 days
- Combine limits for coverage A & B
- 30 percent payment of total loss content without inventory
These codes and regulations prevent a lot of matchmaking that takes place in other states. My prediction is that many states will begin to enact similar laws as insurance companies increasingly treat their own customers as third-party creditors with heavy-handed cost-cutting practices.
If you are not from California, please take a minute to read the notice and think about how it would change property adjustment in your state.
Thought for the afternoon
When the Oakies left Oklahoma and moved to California, it raised the IQ of both states.
– Will Rogers
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