Jeff - This sounds like something the insurance company would do.  And you are right that insurance will cost more and be more difficult to get just like it was after the hurricanes in Florida.

Jeff,

In Florida we have the same concept during a hurricane...when the storm is in what we call the box....most insurance agencies will not write while it is wobbling inside the box.

Jeff - Thanks for the head's up on this. 

Jeff, WOW that is not a good situation for buyers right now, and this could have major complications for Realtors and Lenders.

Echoing Neal Bloom, here in Florida insurors won't issue insurance while there is a named storm anywhere in "the box". Even our standard FAR contracts take thid delay into consideration

A very timely post Jeff and this may become a real issue again at least  as you mention here in the southern part of the state. This caution should be headed and we can all expect our insurance expense to rise again.  The cost of living here is escalating every year and I expect it to start showing a greater impact on people.

Jeff: Insurance companies are in a quandary, with the blazes still going. The California Fair Plan is a minimal policy that will protect the lender and homeowner against fire--but not against burglary and other types of comprehensive damages. My recommendation would be to go ahead and close with the Fair Plan, and get other insurance after the close of escrow. Things will normalize before long....

Hope the property is not backing up to a canyon or forested area--or an area prone to landslides!

Hi Jeff,

Thanks for the info on this, not surprising though. I'll be sure to share it with others in my office. We had a closing today that backed the hills in Yorba Linda.

We also have the same thing every now and then after earthquakes. The Northridge and the Whittier quakes were two of the last large ones that had a significant impact. Seems like most companies will also want to do a "drive-by" or an onsite visual inspection prior to writing policies.

And yes, we will all be paying more at some point.

Oh Jeff, you just got to laugh sometimes.  EVERYTIME an earthquake or fire hits all of the insurance companies run as fast as they can...just when Californians need them most.  It just sucks doesn't it?

Thank you all for your comments. THis is new to me as we did not run into this back in Boston, even with the snow storms. Good learning. It makes some sense even though it causes a grea deal of angst for many folks, even those who are not in affected areas. It is just one more painful reminder.

I have been heading that the moratorium will be lifted Monday - we'll see. My buyers are due to close Wednesday so they pretty anxious.

They are making progress with the fires - some are now 50% contained which is a significant improvement.

We ALL know what will happen to rates, of course.

Jeff

Jeff- Welcome to California..as Diane noted this always happens in CA after a disaster.  Surprisingly rates won't go up that much because of Prop 108... no they are far more clever.. they will just decide no to write new policies in CA ..  In some areas they will cancel existing policies.  however this time the State Insurance Commissioner seems to be taking a more pro-active stance about the the possible shenanigans of the insurance companies. Never a dull moment..

Kaye - well it certainly is a good learning experience. Good information to know. I had heard some things about the Commissioner so hopefully they will pay close attention.

Jeff

Our closing in Del Mar was delayed because of the insurance moratorium.  We had our escrow extended and are now renting from the owners.  Our insurance had been approved by Safeco but then that got pulled just before closing in light of the fires.  The property is west of I-5, but it does face open space that is part of the torrey pines state reserve.  Anyone know whether this type of property might qualify under the California Fair Plan? 

Bryan - I would check, as I understand from my insurance broker that they are writing policies, but you need to know that they are not as comprehensive, and you will want a different policy once other companies are writing again. Perhaps the moratorium will be lifted soon! Good luck.

Jeff