Trip Report: Insurance Crisis in the Sierra Foothills

We spent several days visiting Calaveras County, where, in 2015, the Butte Fire destroyed 475 homes and killed 2 people. Many of the county’s 44,828 residents live in rural regions of the Sierra foothills. CAL FIRE Chief Josh White gave us a tour of the area that burned, pointing out brush and tree characteristics that affected the fire, and why some homes were still standing after the fire’s onslaught.

Burned-out trees from the 2015 Butte Fire
From left to right: Kevin, Tom Pratt from FACE insurance (, Jason Cowan reporting for the Calaveras Enterprise, and CAL FIRE Chief Josh White

We also learned that access to homeowners insurance has been a common frustration after the recent spike in severe wildfires. The area’s largest title company told us that home buyers’ inability to find insurance has held up deals. Real estate agents have been looking for high risk insurance options for their clients. One realtor described 2,200 homes in Arnold that have had a rash of policy cancellations, and are struggling to find insurance carriers who will sell them a new policy. At town hall events, local government officials receive pleas for help in getting insurance. A local reporter who joined us goes into further details in his news story about our visit.

Chief White described recent changes to insurance underwriting practices that he considers overly broad and conservative. The current methods can’t account for a number of proven fire-hardening techniques practiced by many homeowners and communities. His real-life experience confirmed and expanded on much of what we’d already studied about fire science, and as we drove through a variety of neighborhoods, it wasn’t hard to guess which houses are at higher risk than others. But in many cases, these dramatically different risks are all grouped into one category by insurance underwriters.



Trip Report
Can you guess which of these homes would fare better in a wildfire?

When it comes to evaluating a home’s wildfire vulnerability, it’s fortunate how much we’re able to see in a satellite or aerial image. Delos is excited to be working in parallel with CAL FIRE and the Fire Resource and Assessment Program (FRAP) to use new technology to understand more about each individual home’s risk, and how those risks change throughout different seasons. We believe that new underwriting models can better reflect changing conditions and homeowners’ efforts in reducing their risk. And then, in turn, we can incentivize actions that help all homeowners and communities be safer from increasing severe wildfires.


How to know your home’s wildfire risk, and what you can do to protect it

If you live in California, chances are you’re perfectly aware of dramatic increases in wildfires. Droughts and record-breaking temperatures have everyone wondering if their neighborhood could be the next to go up in flames. In fact, wildfire losses are expected to triple in the next 30 years– and that danger is always changing, depending on the weather.

There are some regions that the state has already designated as high wildfire risk, such as Chico, Sacramento/Roseville, and Riverside/San Bernardino. You can see a map of all the regions here. These communities receive extra fire prevention services, such as brush clearance and property inspections. However, the way that these zones are officially identified doesn’t necessarily keep up with reality on the ground. What if you don’t live in these areas, but the wildfire risk increases in your community? What happens in the potentially several years of lag time before the state provides those special precautions?

You can take action now. First, you can harden your home so that it’s much less likely to be destroyed in a wildfire. And second, you can be proactive about your homeowners insurance, so that you’re protected from a tragically common financial shock that’s easy to avoid.

Some aspects of your home could potentially determine whether it’s left standing. The way most homes ignite in wildfires is from embers and small flames, so keep roofs and gutters clear of leaves and debris, and cover all vent openings and chimneys with metal mesh. Wildfire heat can cause windows to break and allow embers in, so install dual-paned windows with one pane of tempered glass.

Creating a “defensible space” can also dramatically change your odds. The perimeter of your home out to 5 feet is the most important– keep it clear of vegetation that could ignite and send flames up the sides of your house. For at least 30 feet on all sides, plants and lawns should be kept trimmed and low. Prune any branches that overhang or touch the house, to at least 10 feet. Clear dead vegetation from under decks. Patio furniture should be fire-resistant. Firewood and propane tanks should be placed more than 30 feet away. See more details are at Cal Fire’s website.

But even if you harden your home, the worst could still happen. Here’s a shocking statistic: 60% of homeowners are underinsured. And wildfire loss is total, including possessions inside the home. Disasters often leave many unprepared families financially crippled because their policies were out of date. Are you one of those underinsured homeowners?

If you’re in an area that has any chance of a disaster, it’s worth the effort to keep your homeowners insurance as up-to-date as possible. This means reassessing your replacement cost coverage limits every 2-5 years, and regularly documenting the contents of your home.

At Delos, we’re building tools to help homeowners protect themselves from the ever-increasing risks of disaster. We offer individually customized reports to explain your home’s disaster risk exposure, along with prevention tips and professional insurance advice specific to your needs. And soon we’ll be launching our own brand of technology-powered property insurance. We’re leveraging vast amounts of data to so that our customers are always protected. We’re working to bring the peace of mind back to insurance.