What Do You Need to Know About Homeowners’ Insurance and Wildfire Coverage?

home insurance fire coverage

Wildfires across the United States pose a growing challenge as the acreage burned continues to rise. For homeowners in many states, this highlights the importance of including reliable wildfire coverage in their insurance policies. While some insurance providers exclude wildfire coverage from standard policies, many fill the gap.  

A United Nations Environment Programme report highlights the growing occurrence of extreme wildfires worldwide. As wildfires become more frequent, it is natural to wonder how your home insurance policy protects you against wildfire damage. Most insurance policies provide home insurance fire coverage for wildfire damage. However, if you live in a high-risk fire zone, there may be specific conditions to remember. 

What Are Wildfires? 

A wildfire is an uncontrolled fire that spreads through wildland vegetation, such as prairies, grasslands, and forests. These fires often begin due to human activities or natural events like lightning. 

Wildfires occur frequently across the United States, causing significant damage to property and personal belongings. Despite the widespread danger, a few areas have managed to avoid wildfires entirely. 

Types of Insurance That Cover Wildfire Damage 

Wildfires can cause devastating damage to homes and property, making it essential for homeowners and renters to have the right insurance coverage. Here are the types of insurance that may help protect against wildfire damage: 

1. Homeowners’ insurance 

Homeowners’ insurance generally covers the repair or rebuilding costs of a home damaged or destroyed by wildfires, including the structure and attached structures like garages or decks. It also covers personal belongings inside the home, such as furniture, electronics, clothing, and appliances. 

If the wildfire makes the home uninhabitable, additional living expenses coverage helps pay for temporary housing, meals, and other living costs during repairs. 

2. Renters Insurance 

While a landlord’s insurance covers the building, it does not cover residents’ personal property. Renters’ insurance protects belongings like electronics, clothing, and furniture damaged by fire. It also covers temporary housing costs, helping residents manage living expenses while recovering from wildfire damage. 

3. Condo Insurance 

Condo insurance, or an HO6 policy, offers coverage for the unit’s interior and personal property. While the condo association typically insures the building’s exterior, condo owners are responsible for their unit’s interior and customizations. Condo insurance covers interior walls, flooring, and personal belongings and provides loss assessment coverage if shared spaces incur damage not fully covered by the association’s insurance. 

4. Landlord Insurance 

Landlords need a dwelling fire policy to protect rental properties from wildfire damage. This policy covers the structure of the rental property, repair or rebuilding costs, and lost rental income if the property becomes uninhabitable. Also, landlord insurance includes liability coverage if a resident is injured due to wildfire-related damage. 

5. Specialized Wildfire Insurance 

For homeowners in high-risk wildfire areas, standard insurance may be insufficient. Specialized wildfire insurance provides extended dwelling coverage with higher limits to cover increased rebuilding costs. It also covers debris removal and protection for landscaping features such as trees, shrubs, and fences. This type of insurance fills the gaps left by standard policies, ensuring thorough protection for residents in all regions. 

6. State and Government Insurance Programs 

In areas where private insurers limit coverage due to wildfire risks, state-backed insurance programs offer essential protection. Programs like the California FAIR Plan are designed for homeowners who cannot secure traditional insurance. These plans cover damage from fire, lightning, and explosions but may require additional policies for broader coverage. Other states offer similar programs to ensure that homeowners can obtain basic protection in wildfire-prone areas. 

Does Homeowners’ Insurance Cover Wildfires? 

Homeowners’ insurance generally covers fire damage, including that caused by wildfires. Fire-related damage is typically included, regardless of the policy type. However, some insurers may limit or suspend coverage in areas prone to wildfire risks.  

Wildfire-related claims can be financially overwhelming for insurers. Economic losses from wildfires, droughts, and heatwaves have been substantial, with insurance losses also rising significantly. As a result, homeowners in high-risk wildfire zones may struggle to secure coverage from private insurers. 

How to Prevent Home Damage from Wildfires 

Securing homeowners’ insurance can be a vital step in financially protecting your home from wildfire damage, but taking proactive steps to reduce fire exposure may help prevent damage altogether. By following these steps, you can lower your home’s wildfire risk and may even qualify for mitigation discounts from some insurance carriers: 

  • Ensure Water Access: Place visible hoses at intervals across your property to allow firefighters quick access to water in case of a wildfire, helping them extinguish embers and protect your home. 
  • Create Defensible Space: Clear flammable materials around your home to prevent wildfire flames from reaching your property. This includes removing vegetation and debris and regularly clearing dead plants to eliminate fuel for the fire. 
  • Consider Fire-Resistant Materials: Choose fire-resistant construction and landscaping materials, such as concrete or stone, instead of wood. Fire-resistant roofs and native, drought-resistant plants can further reduce your home’s exposure to fire damage. 
  • Clearly Mark Your Address: Make sure your home’s address is visible from the road. This simple step helps firefighters quickly identify and defend your structure during a wildfire. 

How to Complete an Insurance Checkup 

Conducting a regular insurance checkup ensures your coverage stays updated and provides adequate protection, especially in unexpected events like wildfires. Here is how to review and optimize your insurance policies effectively: 

  • Contact Your Insurance Agent: Schedule an annual review with your agent to assess your coverage needs. 
  • Update After Home Improvements: Ensure your policy reflects upgrades or renovations to your home. 
  • Check for Essential Coverages: Confirm your policy includes key protections such as extended replacement cost, inflation adjustments, living expenses coverage, and building code compliance. 
  • Verify Home Details: Review your policy for accuracy regarding your home’s square footage and finishes. 
  • Consider Renters Insurance: If you are renting, protect your belongings with a dedicated renters insurance policy. 
  • Maintain Homeowners’ Insurance: Keep your policy active, even if your home is fully paid off. 
  • Add Auto Coverage: Include post-wildfire vehicle replacement coverage in your auto policy for added peace of mind. 

What Should a Wildfire Policy Include? 

As an insurance provider, offering comprehensive wildfire coverage is essential for addressing homeowners’ unique risks and providing them with reliable protection. Designing policies that address these critical areas prevents coverage gaps and strengthens customer trust and satisfaction. 

A robust wildfire insurance policy should include coverage for the structural components of a home, such as roofs, walls, windows, doors, and flooring, which are especially vulnerable to wildfire damage. Adequate content coverage is equally important, safeguarding personal belongings like furniture, electronics, and appliances. 

Additional living expenses coverage is another critical feature, helping policyholders manage temporary housing costs and daily living during repairs.  

Adding landscaping protection enhances a policy’s value by covering losses to gardens and outdoor features, while smoke damage coverage ensures claims are processed even without direct fire damage to the structure. By providing these essential coverages, you demonstrate your commitment to offering comprehensive solutions, helping clients navigate wildfire risks with confidence. 

Conclusion 

At BFPMInc., we understand the importance of safeguarding your properties and assets against the growing risks of wildfires. We ensure that property owners and residents are protected from potential losses, such as structural damage and personal belongings. Our commitment to excellence means managing your properties efficiently and helping you navigate challenges confidently.   

Contact us at BFPMInc. for expert guidance in property care, including wildfire preparedness and recovery. 


Trevor Henson

Trevor Henson is an experienced entrepreneur (10+ highly-successful start-ups) and property investor with a demonstrated history of building and leading teams in investment property management environments, maximizing returns for property owners, and optimizing properties through construction management and re-positioning. He…
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Frequently Asked Questions(FAQs)

Most standard homeowners' insurance policies include coverage for wildfire damage and protecting the home’s structure and personal belongings, but coverage details may vary by provider and location.

The 80% rule in fire insurance requires homeowners to insure their property for at least 80% of its replacement cost to receive full reimbursement for partial damages. Failing to meet this threshold may result in reduced claim payouts.

Wildfire coverage is typically included in standard homeowners’ insurance, but in high-risk areas, it may require a separate policy or additional endorsement for comprehensive protection.

Renters’ insurance typically covers wildfires, protecting personal belongings like furniture, electronics, and clothing, as well as additional living expenses if the rental becomes uninhabitable.