Given the increasing risk of wildfires impacting Colorado neighborhoods and residents’ struggles in managing and receiving payment on their insurance claims, Colorado recently passed House Bill 22-1111 which provides additional assistance and insurance payment requirements for wildfire victims. The bill establishes new coverage and payment requirements for insurance companies in the event a policyholder experiences a total loss due to a fire disaster as declared by the Colorado governor. Always remember to review your insurance policy as it may contain additional terms or benefits beyond what is required by law.
Dwelling Coverage: Under the new legislation, insurance companies must now allow wildfire victims 36 months with two 6-month extension opportunities (as opposed to the prior 12-month requirement) in order to rebuild or relocate following a wildfire and still recover depreciation. In addition, insurers may not limit or deny a policyholder’s recovery of ordinance and law and extended replacement cost coverages on the basis that the policyholder is rebuilding in a different location or purchasing a new home instead of rebuilding. Insurance companies must also reimburse their policyholders for the cost of debris removal services within 60 days of receiving a receipt for those services.
Additional Living Expense Coverage: The policy must also provide for at least 24 months of additional living expense reimbursement with two 6-month extension opportunities.
Contents Coverage: The prior Colorado statute required reimbursement of at least 30% of the value of the policyholder’s contents without having to supply a written inventory to the insurance company. Under the new legislation, the insurance company is now required to pay a minimum of 65% of the value of content coverage without the policyholder needing to provide a written inventory of the contents. This is just the statutory minimum - the actual amount owed upfront may be more depending on the text of the insurance policy or by agreement with your insurance company.
Once the victim of a wildfire submits an inventory of lost contents, the new legislation requires insurance companies to request any additional information from the victim within 30 days, and to pay out claims for undisputed, insured items within 30 days after receipt of the inventory list. The policy must also provide policyholders with the greater of 365 days after the expiration of additional living expense coverage or 36 months after the insurer provided the first actual cash value payment to recover depreciation on contents.
Underinsurance Assistance: If the dwelling limits of insurance are insufficient to rebuild the home, under the new legislation wildfire victims can use other coverages to supplement the dwelling limit.
House Bill 22-1111 does not apply to previous wildfires such as the Marshall Fire. However, many insurers told the Colorado Division of Insurance that they would provide Marshall Fire victims with additional benefits, assistance, and extensions on their coverages. If you have questions about how best to leverage these agreements, the attorneys at MoGo LLC can help!
How to request a copy of your policy
Under current Colorado law, your insurance company must give you an electronic copy of your policy within three business days of a written request.
For example, send an email to your adjuster stating:
“Please send me a copy of my insurance policy, including the declaration page and any endorsements, within three business days.”
Your insurance company owes you what is stated in your insurance policy. If you have any questions and/or are struggling to receive the information or benefits owed under your insurance policy, contact the attorneys at MoGo LLC for assistance.