Hi all,
Quick question as I'm trying to do more research on the topic. Do all homes in Montclair require additional fire insurance or are there pockets that don't require it?
My understanding is that the very top portion (near Skyline) requires it as well as lots of Piedmont Pines, but the areas closer to the base near Montclair village are OK with normal homeowner's insurance.
Can anyone confirm?
OP - I don't think you fully understand this, which is understandable because it's somewhat complex. I live in Montclair and have done a lot of research into this. There are three types of homeowner insurance policies one might get in CA:
A traditional homeowner insurance policy in California is issued by insurance companies which are regulated and approved by the California Insurance regulator. This is also called an "HO-3" policy. The rates on these are regulated and usually quite cheap compared to other states because we don't really have risks like hail, tornadoes, etc. here. These policies cover everything except flooding. This is what all the big national insurance companies offer here.
Next you have "Non-admitted" or "Surplus lines" insurers. These are insurance companies which are NOT regulated by the CA regulator. You're only allowed to buy one of these through a registered insurance agent/broker, and only after you've been rejected by "admitted" insurers. They can basically charge whatever they want and have higher deductibles, but it's still a competitive market. In the event that your insurer goes bankrupt, there's no promised bail-out from the state. These are generally still comprehensive policies that cover everything but flood as well. Pricing can vary widely but it's generally 2-4X a traditional policy.
Lastly you have the FAIR plan which is the state fire insurer of last resort. This only covers fire, so a broker will bundle a FAIR policy with a supplemental "Difference in Conditions" policy (DIC) from another company like Farmers or Aegis. FAIR is generally quite expensive even with high deductibles. Most people would prefer a surplus lines carrier over FAIR for the reason of only having 1 policy as well as lower rates.
I'm assuming that by "additional fire insurance" you were referring to FAIR. In the Oakland hills above 13, generally nobody is getting NEW traditional HO-3 policies written any more although many people who bought in the 90s or 2000s are still on them. There may be some exceptions for new construction I've heard but that's quite rare. Many people ARE still getting surplus lines policies. On my block in Montclair I don't know anybody who is on FAIR, lots were dropped but everyone found a surplus lines policy.
It's not easy to generalize about neighborhoods because different insurance companies use different geographic filters to deny coverage. Many use broad swaths like zip code, but some use more granular geographies.
My advice here is to talk to multiple independent insurance brokers (not one who only sells 1 big-name company). If you're looking at buying, it's easy to find out if a property will get an HO-3 policy by using any of the online policy shopping sites - you can just enter the address and the info from the MLS about roof etc.
I own a condo in uptown and thus have no real direct involvement in these issues, but I have to say this is a particularly helpful and clear breakdown to write up gratis.
The other common exemption is earthquake insurance which should enter into your coverage calculations.
thank you. this is the exact responses I needed to understand!
just so I'm extra clear, when CA FAIR is purchased... that is usually when even the non-admitted carriers refuse to extend coverage?
It's up to you to choose what makes sense for you financially. Either FAIR or the surplus lines policy can only be purchased when traditional carriers have rejected you. FAIR doesn't care about whatever offers you may have gotten from surplus lines though - they only care that your broker tried several traditional insurers and was rejected by all.
The weird part is that different brokers may have access to different surplus lines insurers, so you may talk to one broker who says FAIR is the only option, and then another broker gets a surplus lines offer which is better.
Do some research on the California FAIR. When I looked into it, it seemed to be strained and difficult to file a claim with. Apparently no one expected so many insurers to pull out of CA and so many Californians to start insuring with it.
The surplus ones might be easier to file a claim with (get a payout) but definitely do your homework on whichever surplus insurance a broker recommends.
I also know that the fire maps these days are much more granular - one house that’s half a mile away from another might have completely different insurance requirements.
When we bought our home, no big insurance companies would insure us, but I was able to do enough repairs to the point that my old homeowners insurance would provide insurance for the new home. No one but surplus or fair would touch one of the other homes we were looking at which is literally .4 miles away.
It’s wild how fast this is changing. But these wildfires of year’s past really flipped the script from coverage “based on the past 50 years of historical data” to “new climate change models that put your house in a 1-10 gradient system of risk based on all sorts of factors.”
You can get a new HO3 through USAA (but qualifying requires military service)
this dude knows his/her shit.
It's property by property. If you're thinking about putting in an offer definitely get insurance quotes first to help square up the house math.
From our data in 94611 we see a fair bit higher costs than 94610 as well as fewer admitted options in the former. (~4k -> ~2.9k).
This tool has helped a lot of folks in Oakland get off or avoid FAIR in favor of surplus plans. It's like a normal online comparison sites, but it also checks those broker only policies and you don't have to call someone to finalize the policy (unless you want to).
We're in the Montclair area and recently had to get new insurance. No traditional insurer is writing new insurance policies up here at all (not Hartford, USAA, State Farm, Allstate, Travellers, Farmers, AAA - none of them). We couldn't even find a non-admitted carrier who would write us a fire policy.
So what we ended up with is 1) fire insurance through the FAIR plan, 2) a 'Difference in Conditions' policy with a non-admitted insurer, which covers everything except fire, and 3) earthquake insurance through the California Earthquake Authority (I can literally see the Hayward fault from my house). None of this is cheap and you will be in for a surprise at how challenging it is to even find a broker that wants to work with you (especially this time of year).
i have a normal policy. got dropped once about 5-6 years ago but was able to find new provider. it's abt 300/mo
You need to be covered for fire...even on the lower hills like Crocker or Rockridge. That is not easy. Like others said....you might be thinking the FAiR plan. Government guaranteed last option.