Sandy Vignolo is speaking out after her annual insurance premiums increased a staggering amount.
The Dutch Flat, California senior is paying nearly $8,000 for fire insurance alone — plus a separate liability policy — after she spent $1,100 to cover her home just a few years ago before her insurer dropped her policy, according to ABC10.
“We’ve had to dip into savings to pay that,” Vignolo told the broadcaster in a story published July 4. “There’s a lot of people around here … that it has gone beyond what they have.”
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Vignolo signed up for the state’s FAIR plan, the high-cost fire insurance of last resort, for coverage when she was dropped by her insurer. Suzanne Vidal, another Dutch Flat resident, told ABC10 an elderly neighbor of hers is now paying $15,840 on the FAIR plan, compared to just $1,800 in 2020.
“People are losing their homes,” Vidal told the broadcaster. “Even if they don’t have a mortgage and they’re paying that much for insurance, that’s hard to come by if you’re on fixed income. Let’s say you’re making $1,200 to $1,800 a month in Social Security. There’s just no way you can do it.”
‘Maybe next year’
However, the state is promising better insurance offerings to come. Reforms being rolled out by insurance commissioner Ricardo Lara’s “Sustainable Insurance Strategy” are meant to help homeowners get off the FAIR plan and into better private insurance offerings.
“Definitely by no later than the end of this year, starting of next year, you’ll start seeing more correction in the market,” Lara told state lawmakers on July 2.
Deputy insurance commissioner Michael Soller says a market correction means more competition, per ABC 10.
But Vidal, a real estate broker, remains skeptical.
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“They told us this in my industry a year ago, that this year was going to be totally different. The first of the year, a lot of these companies were going to come back into our market with insurance available at reasonable or sensible prices,” Vidal said. “Now it’s, ‘Maybe next year.’”
Meanwhile, she and Vignolo warn that many elderly residents of California simply can’t wait that long for insurance prices to come down.
Cope with high insurance costs
If you are living in a high-risk area, one that is prone to severe weather and high crime rates, you are advised to shop around as much as possible for coverage.
Homeowners can contact their insurer if they receive a non-renewable notice to find out if there are any steps they can take to retain their coverage. If you feel your non-renewal was unfair, you may be able to file a complaint with your state insurance department.
If your home is deemed uninsurable due to old plumbing, outdated electrical or other issues, it may be necessary to find a means of bringing these up to code so that you can retain your insurance coverage.
California’s Department of Insurance recommends that homeowners who have tried to find private insurance look into the non-admitted/surplus lines market to find coverage. For users of the FAIR plan, they also recommend supplementing your coverage with a private policy to extend your coverage beyond fire protection.
If your insurance costs have increased substantially, it may be time to consider shopping for a new plan, or even reducing your coverage to bring down the total cost of your bill. The California Department of Insurance offers a Homeowner Coverage Comparison Tool to help you compare offers and find the right insurance plan for you.
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
