The contractor and the Insurance Claim
The contractor and the insurance claim
Now that the fire fighting has ended successfully and the flames are out, the real heat is about to begin. That seems like a funny statement to make, however I can see trouble ahead in reaching the final decisions of what the total fire damage repair cost will amount to, for life to return to normal especially in Pacific Palisades and Altadena.
As I see the situation right now, the most significant enemy that lays ahead is confusion. Confusion because each insured dwelling will have its own insurance company behind them and the estimate which will be determined may be different than the neighbor's loss amount and cost to rebuild even though their homes are similar.
Several articles have now been written which evaluate the average rebuilding cost for a Pacific Palisades home at $947,000 and Altadena at $262,000. Now to add more fuel to the fire, we have real estate developers entering the fray to buy burned out property, especially in Pacific Palisades.
Just as I was working on this article, another news flash shows that a wildfire is burning out of control close to the City of Bishop California. The cause of the fire is listed by Cal Fire as being unknown at this time. I am afraid this new fire will only cause more confusion as to which authority is setting coverage limits and which authority will be issuing payments.
The reason for the mention of confusion has to do with being aware of the following organizations that are involved already in the investigation and evaluation of this loss:
The Federal Emergency Management Agency: This is a federal government agency which is designed to assist those without traditional homeowner insurance.
The California Fair Plan: This agency is designed to function more like the traditional insurance company. California residents can purchase insurance coverage for their homes and property, although, the premium will be higher than the traditional company. This policy is usually purchased by residents whose insurance was discontinued, or due to the fact the risk itself is in a hazardous area.
Now, with these two government agencies we also have the more traditional insurance companies, each with their own separate policies and applicable coverage for the needs of their clients. In addition to the above, we also recently had the mayor of Los Angeles indicating that she has hired a consultant, Mr. Steve Soboroff, to be appointed as the chief recovery officer. Mr. Soboroff is indicated as being a Real Estate Developer. Mr. Soboroff will be fulfilling his duties at no cost to the City of Los Angeles, which may be or may not be a positive development, as no one has yet to define the estimates for the repair of the thousands of damaged homes, which will be reviewed, much less written by qualified contractors and Insurance Adjusters.
It might be possible in the Star Trek world to have all of the insurance companies agree on one total for repair given to them by an arbitrary estimator, however, I believe we are in for a long haul before the true cost of repair for the fire damage is determined, much less for a determination of who is responsible for the fires and recovery attempts shared.
If you have any questions or comments, please contact me at,
Norman Lambe