FAQ – Wildfire: Rebuild & Repair

The Weeks & Months Ahead

A total loss or major wildfire claim can take months, or longer, to fully resolve. These FAQs provide general guidance about some of the bigger insurance and rebuilding questions you may encounter along the way.

Will my insurance rebuild my home exactly as it was?

If your policy provides replacement cost coverage, it generally pays to repair or rebuild your home with materials of like kind and quality, subject to your policy limits, terms, and endorsements.

Insurance is intended to restore what you had before the loss, not necessarily create an exact replica or pay for upgrades you choose during the rebuild. If you decide to upgrade finishes, increase the size of your home, or make other improvements, you may be responsible for those additional costs.

Your adjuster and contractor will work through the scope and estimated cost of rebuilding based on your specific home and policy.

What if rebuilding costs exceed my insurance limits?

Start by checking whether your policy includes Extended Replacement Cost coverage.

Extended Replacement Cost may provide additional coverage above your listed dwelling limit, often a percentage, such as 25%, 50%, or more, when the cost to rebuild exceeds your Coverage A limit after a covered loss.

These coverages vary significantly by carrier and policy, so don't assume the number shown under Coverage A is necessarily the maximum available for rebuilding. Ask your agent or adjuster to review all applicable replacement cost endorsements with you.

Building codes have changed since my home was built. Is that covered?

Possibly. This is where Ordinance or Law Coverage can become important.

If current building codes require upgrades that weren't part of your original home, such as electrical, structural, energy-efficiency, or other code requirements, Ordinance or Law coverage may help pay those additional costs.

The amount available varies by policy and may be subject to a separate limit.

Ask your adjuster specifically: “How much Ordinance or Law coverage do I have, and how will it apply to my rebuild?”

How long does rebuilding usually take?

There isn't one standard timeline.

After a major wildfire, rebuilding can take many months and, in some cases, well over a year. The timeline can depend on:

• Debris removal and site preparation
• Claim evaluation and settlement
• Architectural plans and engineering
• Permits and inspections
• Contractor availability
• Labor and material availability
• Weather
• The number of homes rebuilding simultaneously

Large wildfire events put extraordinary demand on contractors, building materials, permitting departments, and other local resources.

It's understandable to want life back to normal as quickly as possible, but rebuilding a home after a catastrophic loss is a long process. Stay in regular communication with your adjuster and contractor, keep good records, and ask questions as you move through each stage.

Will I be able to get insurance after I rebuild?

Hopefully, yes, but no one can guarantee today what the insurance market will look like when your home is completed.

Insurance availability and pricing can depend on the carrier, location, wildfire risk, rebuilding standards, mitigation measures, claims history, and the insurance market at the time you're ready for coverage.

Rebuilding in an area affected by wildfire does not automatically mean your home will be uninsurable.

As you plan your rebuild, ask about wildfire-resistant construction and mitigation measures that may improve your home's resilience and could also be viewed favorably by insurance companies.

Stay in communication with your insurance agent throughout the rebuilding process rather than waiting until construction is complete to discuss future coverage.

Can I rebuild somewhere else instead of on my current property?

Possibly.  Talk with your insurance company before making this decision.

Some policies allow homeowners to take their covered insurance proceeds and purchase or rebuild elsewhere, but how much is payable, and when it becomes payable, can depend on the policy language.

Replacement cost benefits, Extended Replacement Cost, Ordinance or Law coverage, and other benefits may have specific requirements tied to actually repairing or replacing the damaged home.

Your mortgage company may also have an interest in the insurance proceeds.

Before buying another property, selling your lot, or deciding not to rebuild, ask your adjuster to explain in writing how that decision would affect the benefits available under your policy.

How do I choose a contractor after a wildfire?

Unfortunately, disasters often attract unlicensed or dishonest contractors.

Before hiring anyone:

• Verify they are licensed and insured.
• Ask for local references.
• Obtain a written estimate.
• Read the contract carefully before signing.
• Be cautious of contractors demanding large upfront payments.
• Never feel pressured to make an immediate decision.
• Be wary of anyone offering to guarantee insurance payments.

If your insurance company recommends contractors through a preferred vendor program, you are generally free to consider other qualified contractors as well.

Take your time, ask questions, and choose a contractor you trust.

Should I cancel my homeowners insurance if my home was destroyed?

Don't cancel your policy without first talking with your insurance company or agent.

Even if your home is a total loss, your policy may continue to provide important coverage during the claims and rebuilding process. Depending on your policy, this could include coverage for your personal property, Additional Living Expenses (ALE), liability, debris removal, and other benefits related to the loss.

You may also still own the property and have liability exposures associated with the land while your home is being rebuilt.

Your insurance needs will change throughout the rebuilding process, so talk with your agent and carrier before making changes or canceling coverage.

Do I need renters' insurance while I'm displaced or evacuated?

Maybe.  Your existing homeowner's policy may continue to provide coverage for your personal belongings and liability while you're temporarily living somewhere else, so you may not need a separate renters policy.

However, everyone's situation is different, especially if your temporary housing becomes long-term or you sign a lease.

Before purchasing or declining renters' insurance, ask your insurance company or agent how your existing homeowners policy applies to your temporary residence and whether any additional coverage is recommended.

Does my personal property coverage extend to temporary housing?

Generally, homeowners' policies provide some coverage for your personal property while it is temporarily away from your insured residence, including belongings you take with you to temporary housing.

However, policy limits, special limits for certain types of property, deductibles, and other restrictions may still apply.

If you'll be displaced for an extended period or are moving significant amounts of property to another location, let your insurance company or agent know so you can confirm how your coverage applies.

Will my insurance rates go up after making a wildfire claim?

They may, but there isn't a standard percentage or outcome that applies to everyone.

Insurance rates are influenced by many factors, including claims history, location, rebuilding costs, wildfire risk, carrier pricing, and broader changes in the insurance market.

A large wildfire can also affect insurance pricing throughout an area, meaning rates may change even for homeowners who didn't personally file a claim.

Your individual claim may be one factor considered by an insurance company, but your agent generally cannot predict exactly how a particular claim will affect your future premium or underwriting.

If you're concerned about the long-term impact, talk with your agent about your specific carrier and policy. As your renewal approaches, you'll have a much clearer picture of any changes.

 

Still Have Questions?

Every wildfire loss is different, and so is every insurance policy.

If you’re an NTI client and have questions about your coverage or claim, we’re here to help.

If you’re not an NTI client, we hope this information has been helpful as you navigate the recovery process.

If there’s a question you’d like us to answer in a future FAQ, we’d love to hear from you.

Email: info@northtowninsurance.com
Call or text: (509) 483-3030

Disclaimer: This information provides a general overview intended to bring awareness to insurance coverage, options, and policy considerations. Coverage varies by insurance company, policy, and state. Your insurance company will make all claim and coverage decisions under the terms of your policy. Please review your policy and contact your insurance company or agent for information specific to your situation.