At Insurance Incorporated, we are deeply committed to protecting what matters most to you. As wildfires continue to ravage parts of Los Angeles and other areas of California, a growing number of homeowners are learning a hard lesson: being underinsured can be just as devastating as having no insurance at all.
The Rising Cost of Underinsurance
The recent fires in Los Angeles have left a trail of destruction, displacing families and destroying homes. For many affected, the emotional toll is compounded by an unexpected financial blow—discovering their homeowners insurance coverage is inadequate to rebuild or repair.
Underinsurance occurs when the amount of coverage on your homeowners policy is not sufficient to fully replace or repair your home and belongings in the event of a total loss. Unfortunately, this is more common than many realize. According to industry reports, over 60% of homes in the U.S. are underinsured by an average of 20%.
In high-risk areas like Los Angeles, where building costs are rising and natural disasters are increasingly frequent, the consequences of underinsuring can be catastrophic.
Why Reviewing Your Homeowners Policy Is Critical
Homeowners often set their policy limits based on outdated replacement costs or market values that do not reflect current construction prices, local labor rates, or inflation. Additionally, major updates—like a remodeled kitchen, new room addition, or upgraded roofing, solar panels—are frequently overlooked when it comes to updating policy coverage.
If your policy hasn’t been reviewed in the past year, there’s a good chance your current limits no longer reflect the true cost of rebuilding your home.
Here are some common scenarios where coverage may fall short:
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Recent renovations or improvements not reported to your insurer.
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Outdated dwelling limits that don’t match today’s rebuilding costs.
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Insufficient personal property coverage for high-value items like electronics, jewelry, or art.
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Lack of ordinance and law coverage, which helps cover the costs to bring your home up to current building codes during repairs or rebuilding.
What You Can Do Today
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Schedule a Policy Review
At Insurance Incorporated, our licensed agents offer complimentary policy reviews. We’ll help you assess your current coverage and identify any gaps. -
Inform Your Agent of Changes
If you’ve made improvements to your home, updated landscaping, or purchased expensive personal items, it’s critical to inform your insurance agent. We can recommend appropriate coverage adjustments to ensure you’re fully protected. -
Consider Inflation and Building Costs
Materials and labor costs in Southern California continue to rise. Ensuring your dwelling coverage accounts for inflation is essential for a comprehensive safety net. -
Ask About Extended Replacement Cost Coverage
This optional coverage extends your policy limits in case rebuilding costs exceed your original estimates—a valuable safeguard in areas prone to wildfire or other catastrophic events.
Final Thoughts
The devastation from the Los Angeles fires is a sobering reminder that disasters often strike without warning. Having insurance is a start, but having the right amount of insurance is what truly protects your home, your family, and your future.
Let us help you stay ahead of risk. Contact your Insurance Incorporated agent today to review your policy and ensure your coverage reflects the true value of your home. If you are in need of a quot on insurance call our office at 877-898-9333 for all lines of insurance or go to www.insuranceinc.com
