Business & Real Estate

On the Market: Dealing with changes in home insurance coverage

The damage incurred in the wake of recent wildfires has dramatically impacted insurance companies’ bottom lines. In the past, homeowners didn’t have to worry much about purchasing insurance – it was nearly always available, and at a fairly reasonable cost. That, however, is changing.

Q: Where has the most dramatic change occurred in homeowners insurance?

A: The availability and cost of fire insurance. Not only are the rates rising, but in some places, insurance companies are not writing new policies for fire insurance.

Q: What happens if my insurance company raises my rates?

A: Get on the phone and call around to other insurance companies. (Or call me for some referrals.) In most cases, it is better to stay with your existing company rather than change companies altogether.

Q: What if my insurance company cancels my insurance?

A: A program called the California FAIR Plan (, which operates like the California Earthquake Authority, offers fire insurance. It is expensive, though.

Q: What about flood insurance? Is it required?

A: Around here, it is not usually required unless you are in a designated flood zone. If you are in a flood zone and have a federally insured loan on your house, you will be required to purchase flood insurance (usually in the $2,000-$3,000 per year range).

Q: What other insurance problems are you seeing?

A: Airbnb, vacation rental, etc. If you are using your home for short-term rentals, contact your insurance company to ensure that you have the right kind of coverage.

Also, take action if your home will remain vacant for an extended period of time (usually 60-plus days). Call your insurance company to confirm that you will be covered.

Q: What’s the advantage of an insurance broker versus an insurance company?

A: Brokers offer access to insurance products from a wide range of insurance providers, so that would be a good place to start if you are having trouble finding insurance. Your best bet is to call around. Combining all of your insurance needs under one roof often provides substantial discounts, so be sure to ask.

Q: Should I upgrade the policy I have had for many years?

A: Yes, it is definitely worth reviewing. Replacement costs have risen dramatically, as labor is more expensive. There’s nothing worse than paying for insurance that ends up not covering you when you really need it.

Owen Halliday is a realtor who manages the Sereno Group office in downtown Los Altos. Text or call him with questions, comments, potential column topics or to request a valuation of your house at 492-0062 or email This email address is being protected from spambots. You need JavaScript enabled to view it..

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