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Boulder Fire Victims Call for Insurance Reforms

169 homes were destroyed in the Four Mile Canyon Fire
Photo by Kirk Siegler
169 homes were destroyed in the Four Mile Canyon Fire

Colorado’s interim insurance commissioner got an earful from victims of the Four Mile Canyon Fire at a meeting in Boulder Wednesday night.  Many frustrated people who lost their homes in the blaze want the state to enact tougher consumer protection laws to help victims of natural disasters settle with their insurance companies. But that appears unlikely to happen at least this legislative session. 

About 50 people filed into the Boulder County Courthouse Wednesday night, shedding layers from the bitter cold outside.  They had come for a meeting organized by the county and State Representative Claire Levy (D-Boulder) to share with state officials some of the problems they’ve been having settling insurance claims. 

Most like Carol Leyner considered themselves under insured.

“My Gen Air kitchen stove came back as an $80 camp stove with an igniter,” Leyner said.

Leyner said she’s getting low-balled when she submits claims.

“That’s a general idea of what they’ve done to us and as you can tell it’s really hard to come up with this list and remember everything,” she said. “We’ve been married 47 years, how do you remember 47 years worth of stuff?”

County officials say they’re hearing a lot of stories like this as victims remain in limbo due to the unsettled claims.  Even thoughthe state insurance division has only received 7 formal, written complaints, the number of problems is widely believed to be higher.  Some homeowners worry that filing a complaint or a lawsuit might lead a company to drop their insurance policy. 

Interim state insurance commissioner John Postolowski told the crowd he’s sympathetic to their plight.

“We understand that this fire has devastated many, many lives and many families,” Postolowski said. “We do empathize and we’re here, and we’re always here to help however we can.”

But Postolowski went on to tell the room what many didn’t want to hear.  Colorado simply does not regulate home insurance with a heavy hand.  So Postowloski said he has to balance being pro-consumer with overseeing a fair market for companies.  Indeed, in some states like Florida where natural disasters are common and costly, some companies have pulled out of markets which has driven up costs.

“With that in mind, realize we cannot always solve everybody’s concerns,” Postolowski said. “I know myself I’m a consumer, I buy insurance, but sometimes I cannot get exactly what I want based on the contract or based on Colorado insurance law”.

Postowlowski’s office did recently write a non-enforceable bulletin urging insurance companies to better work with the wildfire victims and give them some breaks such as a 180 day extension to what are called ALEs – or additional living expense payouts. 

Still many in this room and even county officials want the state to make things like this mandatory.  They’re pushing for systemic changes to help victims of future natural disasters. 

Expect insurance companies to fight such a move. 

“A lot of what you’re hearing tonight is they want everything to be required in a policy,” said Carole Walker, executive director of the Rocky Mountain Insurance Information Association.

She said that will drive up costs for everyone.

“If you start requiring everyone to have certain things, people aren’t going to have as many choices when they’re buying insurance, and that’s going to be a problem for a lot of folks too,” Walker said.

Walker said the victims’ homes were insured for what they were worth when they were bought or built, and they don’t take into account the added expense of building new homes under Boulder’s tougher environmental codes.  The county has so far resisted calls to loosen these for fire victims. 

Meantime county officials are urging the state insurance division to convene a summit with fire victims and the major insurance companies.  Good faith deals that could come out of something like that are probably a better hope than changing the state law for people like Sharon Reising.

“Just give us our limits,” Reising said, choking back tears. “Don’t make me write down every paper clip that I had in my house, we have enough distress in our life right now, we really just want to rebuild our home.”

Kirk Siegler reports for NPR, based out of NPR West in California.