FAIR Plan Claims After the LA Wildfires: What You Need to Know

Understanding FAIR Plan Claims After the January 2025 Fires

The California FAIR Plan (Fair Access to Insurance Requirements) provides basic fire insurance to homeowners who cannot obtain coverage in the traditional market. After the Palisades and Eaton Fires, the FAIR Plan faces an estimated $6+ billion in exposure - the largest in its history.

If you have a FAIR Plan policy, here's what you need to know about filing your claim.

What is the California FAIR Plan?

The FAIR Plan is California's insurer of last resort for fire coverage. As traditional insurers have pulled out of high-risk areas like Pacific Palisades, Malibu, and Altadena, more homeowners have turned to the FAIR Plan.

Key facts:

• The FAIR Plan provides basic fire insurance only
• Coverage limits max out at $3 million for dwellings
• You typically need a separate "Difference in Conditions" (DIC) policy for liability and other coverage
• Approximately 15% of Pacific Palisades homes were insured through FAIR Plan before the fire

FAIR Plan Coverage Limits

Understanding your coverage limits is critical:

Dwelling Coverage

• Maximum: $3 million
• Many Pacific Palisades and Altadena homes are worth more than this
• If your home costs $5 million to rebuild, you may have a $2 million gap

Personal Property

• Limited coverage - often 10% of dwelling coverage
• May need to verify your specific policy terms

Additional Living Expenses

• Coverage varies by policy
• Often limited compared to traditional policies

The Coverage Gap Problem

Many Palisades and Eaton Fire victims are discovering they're underinsured:

• Example: A Pacific Palisades home that costs $5 million to rebuild, but has only $3 million in FAIR Plan coverage = $2 million gap
• DIC policies: If you have a Difference in Conditions policy, it may provide additional coverage above FAIR Plan limits
• No DIC: You're responsible for the gap out of pocket

Filing Your FAIR Plan Claim

Step 1: Report Your Loss

Contact the FAIR Plan directly:

• Phone: 1-800-339-4099
• Website: cfpnet.com
• Have your policy number ready

Step 2: Document Everything

Same documentation requirements as any fire claim:

• Photos and videos of damage
• Complete contents inventory
• Receipts and records
• Contractor estimates

Step 3: Understand the Claims Process

The FAIR Plan is processing thousands of claims from the January 2025 fires. Expect:

• High call volumes and potential delays
• Multiple adjuster visits
• Requests for additional documentation

Maximizing Your FAIR Plan Settlement

1. Know Your Policy Limits

Review your declarations page carefully. Understand exactly what coverage you have.

2. Get Independent Estimates

Don't rely solely on FAIR Plan's estimate. Get quotes from licensed contractors familiar with Pacific Palisades or Altadena construction.

3. Document Code Upgrade Requirements

If your policy includes ordinance or law coverage, ensure all required code upgrades are documented and claimed.

4. Track All Additional Living Expenses

Keep receipts for everything - housing, meals, transportation, storage.

5. Consider a Public Adjuster

FAIR Plan claims can be particularly challenging due to coverage limits and the plan's unique structure. A public adjuster can help maximize your settlement within your policy limits.

What If You're Underinsured?

If your FAIR Plan coverage doesn't fully cover your losses:

• Check for DIC coverage: Review any Difference in Conditions policy you may have
• SBA Disaster Loans: Low-interest loans available for uninsured losses
• FEMA assistance: May provide grants for certain expenses
• State assistance programs: California may establish additional aid programs

FAIR Plan Solvency Concerns

With $6+ billion in potential claims from the January 2025 fires, questions have arisen about FAIR Plan's ability to pay claims. Here's what to know:

• FAIR Plan has reinsurance to cover catastrophic losses
• If claims exceed resources, FAIR Plan can assess member insurance companies
• The state is monitoring the situation closely
• Your claim should be paid, though timing may be affected

Get Help With Your FAIR Plan Claim

FAIR Plan claims require specialized knowledge. Our public adjusters understand the unique aspects of FAIR Plan policies and can help you get the maximum settlement possible.

Call (714) 844-1363 for a free consultation.