Nevada County customers lose home insurance; some see double, triple increases

Alan Riquelmy Special to the Sierra Sun
Location plays a role in a home’s insurance, as does its maintenance level and defensible space. (The Union file photo)
The insurance agent told Jeanette George he couldn’t do anything.His company had opted against renewing her home insurance, which will lapse within weeks. That led George to start calling around, trying to find another insurer who will write a policy for her Grass Valley home.

“I’ve been told by everyone that none of them are writing in the area,” George said.

She did find one company that offered to write her a policy, though it would more than triple her home insurance.

George said she paid $1,200 annually on her policy that ends soon. The new quote is almost $4,000.

“That’s one home in Grass Valley,” George said. “And that’s not even full coverage.”

George’s insurance issues come after Merced Property & Casualty Company’s insolvency. The Camp Fire that destroyed the town of Paradise shuttered the insurance company and led state regulators to step in and begin liquidation.

Merced wrote 705 policies in Nevada County, which included more than home insurance.

The failed insurance company wrote a total of 7,531 policies across the state, said Nancy Kincaid, spokeswoman for the California Department of Insurance.

Northern California homeowners have faced insurance issues since before the Camp Fire. Teresa Dietrich, real estate agent and president of the Nevada County Association of Realtors, said she’s yet to see an impact from Merced’s failure.

But that doesn’t mean she hasn’t seen change.

“People can still get policies,” Dietrich said. “Obviously, those policies are more costly. They’re not just assuming it’s fire safe anymore.”

Dietrich works in Nevada, Placer and Yuba counties. She said insurance prices start climbing the closer a home is to Paradise.

Location plays a role in a home’s insurance, as does its maintenance level and defensible space. Dietrich said many of her clients have livestock. People with animals need to know the width of the road leading to their home and whether the tree canopy will impede their vehicle.

“Those are all conversations I’m having with my clients when we’re looking at the property,” Dietrich said.

Insurance woes

The phones have been ringing nonstop at Harris Insurance Services since Merced’s failure.

Richard Harris, owner of the insurance business, said Merced had some $64 million in losses from the Camp Fire alone. About 250 of the 705 Nevada County policy holders through Merced worked with Harris.

And they’ve been calling him.

“We’re replacing them as fast as we can,” Harris said. “There’s three of us working on nothing but replacing Merced.”

Harris noted, like Dietrich, that these issues aren’t new. Four large insurance companies have declined to write policies here for years, barring a few exceptions.

That doesn’t mean no one is writing insurance policies in Nevada County. They are. But Ryan Harris, senior underwriter, called the outlook “grim.”

“Some are horrible, premium-wise,” Ryan Harris said. “Some are good. Some are bad. But there’s also the FAIR Plan as well.”

The California Fair Access to Insurance Requirements Plan was created to ensure those who can’t get insurance on the market have some form of it. The plan website, and Harris, calls it a last resort.

Richard Harris advised people to shop around when looking for insurance. Ryan Harris said they should work with a broker and someone who’s local.

Shelley Mortara, mortgage broker with Nevada County Mortgage, also advised people to keep their business local when searching for financing. Prospective home buyers also should keep insurance top of mind.

Moving Forward

Getting home insurance has always been an issue in Nevada County, but it’s grown more difficult over the past 12 to 18 months, Mortara said.

She advised home buyers to identify the property they want and contact a local insurance agent to ensure they can obtain coverage. It’s best to get a fresh quote.

“That insurance quote from a year ago is likely going to be higher today,” she said.

George, who’s looking at a quote three times higher than her current policy, knows that’s true.

George said she’s put her insurance headache aside for the moment, waiting to tackle the problem in the new year.

“It’s sleepless nights,” she said. “It’s ruining my quality of life right now. I’m going to break the bank in January. I have no choice.”

To contact Staff Writer Alan Riquelmy, email or call 530-477-4239.

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