Triple-I: Californians Should Review Their Insurance Coverage

For immediate release

West Coast Press Office: Janet Ruiz, 707-490-9365, janetr@iii.org 

SAN FRANCISCO, Jan. 12, 2023—Homeowners, renters, businesses, and vehicle owners impacted by California’s severe weather need to know what’s covered under standard insurance policies and how the insurance claim filing process works, according to the Insurance Information Institute (Triple-I). 
 

“Insurers are the nation’s financial first responders and will be there to help their policyholders recover,” said Sean Kevelighan, CEO, Triple-I.  “The high winds and sustained rainfall millions of Californians are facing this week highlight the importance of being financially protected from catastrophic losses and that includes having the right types, and amounts, of property insurance and flood coverage.”

There are four keys to economic recovery after severe weather events, the Triple-I says. 

  1. Start the claims process as soon as possible 
Be prepared to give your insurance professional—either an agent or an insurance company representative—a description of the damage to your property and a copy of your home inventory if you have one. Your insurance professional will report the loss immediately to your insurer or to a qualified adjuster. They also will want your cellphone number to update you on the claim’s status.

  2. Understand what’s covered 
Property damage caused by windstorms, hail, and lightning is covered under standard homeowners, renters and business insurance policies.

Property damage to a home, a renter’s possessions, or a business – resulting from either a flood or mudflow – is covered under a flood insurance policy, which is typically separate from a property insurance policy for a home, rental unit, or a business. Flood policies are underwritten through FEMA’s National Flood Insurance Program (NFIP) and private insurers.

Property damage to businesses caused by windstorms, hail, and lightning is typically covered under a Business Owners Policy (BOP) or through a Commercial Multiple Peril (CMP) policy. Business income (interruption) insurance is an optional coverage that can be included in either a BOP or CMP policy. It provides coverage if the business’ structure was directly damaged by wind, hail, or lightning for:

• Revenue lost due to the closure of the business
• Fixed expenses, such as rent and utility costs
• Expenses of operating the business from a temporary location

  3. Review Your Additional Living Expenses (ALE) coverage 
ALE, also known as Loss of Use, pays the additional costs of living away from home if you cannot live there either due to a mandatory evacuation or because of damage to your home from an insured catastrophe. It is a standard coverage in homeowners and renters insurance policies but ALE is not incorporated into FEMA NFIP policies.

  4. Make Sure You Have Comprehensive Coverage for Your Vehicle 
Vehicles damaged by either floodwaters or debris, such as falling trees, are covered under the optional comprehensive portion of an auto insurance policy. Nearly 80 percent of U.S. drivers have purchased comprehensive coverage.  

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