With wildfire season here, smoke and ash claims can arise under an insured’s homeowners and commercial property policies. For fires that occur close to a property, soot claims can arise as well.

Wildfire SeasonWildfires and the associated risks remain a national concern. In April, a state of emergency was declared in Florida as over 100 active fires burned across the state. The number rose to 142 fires in May.

While East Coast fires are currently under control, wildfires continue to rage out West, burning through Arizona, Nevada, Montana, New Mexico, Oregon, Washington and California and triggering evacuations in many areas.

Across the nation, homeowners and commercial businesses face the threat of damaged property and significant losses. Since the beginning of the year, an estimated 4.4 million acres have already been burned by wildfires in the Western U.S. This reflects a 34 percent increase compared to 2016 and is significantly above the 10-year average of 3.1 million acres.

Furthermore, a study cited in a recent InsuranceJournal.com article reveals that 4.5 million homes in Western states have been identified as facing high or extreme risk of wildfire. Property damage from wildfires is most likely to take place in high or extreme risk areas. The same study reports that the following states have the most households at high or extreme risk this season:

  • California (2 million+ households)
  • Texas (715,300)
  • Colorado (366,200)
  • Arizona (234,600)
  • Idaho (171,200)

Soot, smoke and ash from wildfires can cause property damage ranging from minor (where professional cleaning can return the property to its pre-fire condition) to major, where the penetration of smoke, soot or ash into mechanical units like air conditioning, heating pumps or related ducts and building components like carpets, insulation, dry wall and curtains, is significant.

Examples of fires that can inflict such damage can range from both distant and close-in wildfires, neighborhood fires, and fires within the affected building itself. The damage can be visible and apparent, or hidden in ducts and between walls.

As to whether the policy at issue covers damage, only a review of the policy and the facts can determine coverage. Depending on the policy and the facts, smoke damage that impacts structures (walls, etc.) may be covered by the dwelling coverage. Smoke damage to rugs and the like may be covered under the contents coverage.

Click on the link to read about Bill Hager’s work as an expert on soot, smoke and ash insurance claims.

About Bill Hager

Insurance and Reinsurance Expert

As an expert witness with significant experience determining whether there is coverage in the first instance (for soot, ash and smoke) and then determining whether the insurer has or has not met its claim handling obligations, Bill Hager has testified in a number of cases with such claims, both for policyholders and for insurers.

Mr. Hager served as an insurance regulator for eight years in five positions: (i) Assistant Attorney General assigned to the Iowa Department of Insurance, (ii) First Deputy Commissioner of Insurance, (iii) Iowa Commissioner of Insurance, (iv) Administrative Law Judge, and (v) Executive and Member of the National Association of Insurance Commissioners.

In this capacity Mr. Hager, along with his staff, approved (or disapproved) of the language of insurance policies used by each of the 1,000 property casualty insurance companies doing business in the state of Iowa.

While Iowa Commissioner of Insurance, Mr. Hager also served as a member of the National Association of Insurance Commissioners (including membership on its Executive Committee).

Mr. Hager has also served as President and Chief Executive Officer of the National Council on Compensation Insurance (NCCI) a major property casualty insurance company. He has also served as General Counsel and Chief Lobbyist to the American Academy of Actuaries, Washington DC and serves as well as an Insurance and Reinsurance Arbitrator certified by ARIAS-US and is a practicing Florida lawyer.

In addition to his current role as president of Insurance Metrics Corp., Mr. Hager represents District No. 89 in Palm Beach County as an elected member of the Florida House of Representatives. He serves or has served on the following committees or subcommittees by appointment: Insurance and Banking; Commerce, Judiciary (parent committee), Civil Justice Subcommittee; Taxation and Charter Schools.