Does Homeowners Insurance Cover Wildfires?

Wildfires are a growing concern for homeowners in the US, especially in those regions prone to dry conditions and high winds. As the frequency and severity of these natural disasters continue to increase, many people wonder whether their insurance policies offer protection and, if so, what they cover.

Understanding the coverage options and limitations for wildfires under homeowners insurance is crucial for safeguarding your property and financial stability.

What Does Standard Homeowners Insurance Typically Cover?

Most homeowners insurance policies provide standard coverage for damage caused by wildfires.

These policies generally include two main components: dwelling coverage and personal property coverage. Dwelling coverage refers to the physical structure of your house (roof, walls, etc.,) while personal property coverage insures your belongings, like furniture, appliances, and clothing.

Your policy may also include loss-of-use coverage, which helps cover your day-to-day living expenses if your home is uninhabitable due to wildfire damage. This typically includes the costs of things like temporary housing, meals while you’re displaced, and other essentials.

However, it’s important to remember that coverage limits will vary by policy, so you need to review your plan to make sure that you have the coverage your family needs. For instance, if the cost of rebuilding your home is more than the limit set by your policy, you could face significant out-of-pocket expenses to do so.

Are There Common Exclusions or Limitations?

While wildfire damage in Montana is generally covered by homeowner’s insurance, some policies may include exclusions or specific limitations, and the aftermath of a fire is not the time to discover these.

If your home is in a high-risk area, your insurer might exclude wildfire damage or require you to pay higher premiums. Also, some policies have caps on the total amount that they’ll reimburse for specific items, like luxury goods or valuable collections (art, for example).

Insurers have been known to deny coverage altogether if a wildfire is deemed a predictable or recurring high risk in the area you live. If your policy has these gaps, you might need to consider buying additional endorsements or switching to a policy more specifically tailored to wildfire risks.

What About Smoke Damage?

Wildfires often cause extensive smoke damage, even to homes untouched by flames. Fortunately, most homeowners insurance policies cover smoke damage as part of the standard protection against fire-related issues.

These typically include things like cleaning costs, physical repairs, and replacement of items that were damaged or destroyed by smoke.

If you have smoke damage, you’ll need to document the areas of the house and the items that were affected. Reporting these to your insurer immediately to help ensure a smoother claims process.

Steps to Take Before and After a Wildfire

Being proactive in the preventative steps you take can greatly reduce your risk of wildfire damage and help streamline the claims process if you do suffer a fire.

Here’s what you want to do:

  1. Review Your Policy: Make sure that you understand your coverage completely, especially if it includes any limitations or exclusions. Also, make sure that you confirm with your agent that your policy offers enough protection for your dwelling, all of your personal property, and any additional living expenses you might need in case of disaster. Ask to see specifically in the policy where these amounts are listed.
  2. Document Your Belongings: Create an inventory of your possessions, including photos or videos. This record will be invaluable if you need to file a claim to cover the cost of repair or replacement.
  3. Implement Fire-Resistant Measures: Consider installing fire-resistant roofing, clear any vegetation that’s in close proximity to the exterior of your home, and use fire-resistant building materials for things like fencing, decks, or outbuildings.

After a wildfire, take the following steps:

  • Assess Damage Safely: Don’t enter your property or even the area you live in until your local authorities have announced that it’s safe to do so.
  • Document Losses: Take detailed photos and notes of all damage before starting cleanup or repairs.
  • Contact Your Insurer: Once you’re safe, call your insurance company immediately to inform them of the situation and to begin the claims process.

Filing a Claim for Wildfire Damage

When filing a claim for wildfire damage (or any insurance-related claim), it’s important that you keep copies of all documentation and communication between you and your insurer.

Here are some steps to follow for a successful claim:

  1. Contact the Insurance Company: Notify your insurer as soon as possible and provide them with a detailed description of all fire-related damages and losses.
  2. Provide Evidence: Share photos, videos, and a detailed home inventory list to support your claim.
  3. Keep Records: Save all receipts for temporary living expenses, repairs, and other costs related to damage or losses due to fires.
  4. Work With Adjusters: Be available for inspections and cooperate with your insurer’s adjusters to finalize your claim.

At Western Justice Associates, PLLC, we understand that homeowners insurance often serves as a critical safety net should you experience a wildfire.

While most policies cover damage from wildfires, understanding what yours specifically includes (or omits) and taking the steps you can to protect your property is key. If your home is in a higher-risk area, you may want to get additional endorsements or specialized insurance to fill any possible gaps in your current coverage and make sure that you’re fully protected.

By staying informed and prepared, you’ll be ready to navigate the challenges of wildfire risks and safeguard your financial security and your family’s well-being.