For Agent Use –
This topic comes from the file titled: “Hard Situations that you can’t control, but still have to deal with”
Just this morning we received notice from most of our insurance companies that there is a “Moratorium” on new policies near the new “Morgan Fire” in the Clayton area. These notices usually look like this: “…in accordance with our guidelines, the binding of any new coverage, decreasing of deductibles or increases to existing coverage is prohibited for any and all risks within a five-mile radius of an existing conflagration or active fire line with respect to any wildfire, firestorm, wild land fire, brush, range fire, or forest fire.”
OK, here’s what that means – no new insurance policies near a fire that is already burning. Makes sense, of course. But what if you have a client who is about to close escrow on a house near an “existing conflagration”? Every year during fire season at least on deal is affected by this and we’re often asked if there is a way to get an exception. The hard truth is that there is no way to write a policy on a house in a moratorium area. It just won’t happen. No chance. And if we try and get cute and push it through the system and hope the carrier won’t notice? Sorry – they’ll bounce that new policy faster than a fireman on his way to a brush fire…
What can you do?? If you have a deal in escrow and a fire starts nearby, call Purves to see if there is a moratorium, what the radius is and if there your client’s property is in that radius. We can start there. If the property is in the fire radius, well, from the insurance carrier standpoint there isn’t a work-around. Also, different carriers handle moratoriums in different ways. Since we have a dozen different carriers, we may have on that has a smaller radius or lifts their moratorium sooner. We can watch the fire’s progress and keep checking with the carriers to know precisely if/when the moratorium is lifted. That may be hard news – but you can work from facts, you can’t work from hope and worry. You and your manager may be able to work with the parties involved from the purchase contract standpoint, but we’ll leave that to you capable hands.
There are some events that we just can’t control. In our area, you can count on wildfires being one of those events every summer – and this summer seems to be dragging on longer than normal. At a very minimum – if a fire is anywhere close to your property, call us. At least that way you can be armed with the facts.