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5 Things You Should Know About the California Home Insurance Rights in 2022

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If you are living in or intend to move to California, you might want to know all the California home insurance consumer rights. California has more insurance policyholder protection legislation than any other state in the country. These laws specify what insurers must, can, and cannot do. Court rulings (“case law”), the California Insurance Code, and the California Code of Regulations all contain these laws.

More insurance policyholder protection legislation exists in California than in any other state in the country. These laws spell out what insurers are required to do, as well as what they are permitted to do. These laws can be found in court opinions (“case law”), the California Insurance Code, and the California Code of Regulations.

Quite a good number of consumer laws in California define how firms and their agents must operate when the insured property is harmed and a policyholder files a home insurance claim. Although insurance companies are required to know and follow these laws when handling claims, some companies and adjusters routinely disregard or violate them, and it is often up to you, the consumer, to remind them of your rights and insist that they investigate and pay your claim fairly, fully, and on time.

California’s Fair Claim Handling Regulations will tell you everything you need to know about claim procedures, deadlines, and what you’re owed. They are written as follows:

  • Letters and phone calls have deadlines that must be met.
  • Your insurer’s payment or denial deadlines
  • Deadlines for providing proof of loss documents
  • What information does your insurance provider have to provide you with?
  • What information must you provide to your insurance provider?

1. “Good Faith”

Your insurance company and its representatives have a legal obligation to serve you in “good faith” at all times. As a result, your insurer must take into account your requirements. It must inform you fully and honestly about the insurance it sold you, as well as your rights and responsibilities regarding your claim.

Your home insurance company’s personnel are legally obligated to tell you the truth. This includes in-person conversations as well as any phone, letter, and email correspondence, as well as all advertising and printed materials. This means they have to be truthful about what they sell you, what you pay for, and what you’re entitled to if you file a home insurance claim in California. 

An insurer “must not permit to be issued, distributed, or used any statement that is known, or should be known, to be a misrepresentation” of the policy’s benefits or privileges, or prospective dividends payable under the policy, according to the law. [California Insurance Code 780] No insurer may falsify “relevant facts or insurance policy clauses relating to any coverages at issue” to a “claimant.” [California Insurance Code 790.03(h)(1)]

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A claimant’s age, race, gender, income, religion, language, ancestry, national origin, or physical impairment shall not be considered in the settlement of a claim.

A “good faith” settlement is your right. “In good faith, accomplish prompt, fair, and equitable settlements of disputes in which responsibility has become reasonably evident,” every insurer must try. [California Insurance Code 790.03 (h)(5)]. An insurer can’t make an “unreasonably low” offer, which means it can’t settle a claim “for less than the amount to which a reasonable person would have believed he or she was entitled based on written or printed advertising material accompanying or making part of the application.”

2. Prompt and Honest Communication

Your insurer has a legal obligation to communicate with you as soon as possible. The corporation (and all of its personnel) must react to your messages “quickly, but no later than 15 calendar days” with a “full response based on the facts known at the time.” The insurer must answer any questions you have and any requests you make within 15 calendar days.

Make it a practice to write your California home insurance company letters or emails so that you can keep track of who said what and when. That isn’t to say you shouldn’t communicate with your adjuster; however, if you discuss something vital over the phone, send an email to confirm the chat. If you request copies of your current policy as well as your policy history, which includes past policies, policy upgrades, change notices, and so on, you will be charged a fee (something UP highly recommends you request in writing)

  3. Fair Claims Process

You do not need to complete your contents list using the exact forms provided by your California home insurance provider. Your insurer must accept a legible list with approximate values and ages for each item. 

Unreasonable “proofs of loss” or secondary proofs cannot be demanded by an insurer. You cannot be forced to provide receipts if you provide images or videos of objects in your home, for example, if they contain essentially the same information.

No insurer shall discriminate in its claims settlement practices based upon the claimant’s age, race, gender, income, religion, language, ancestry, national origin, or physical disability, or upon the territory of the property or person insured. How Insurance Companies in California Use Discrimination in their Underwriting Guidelines.

California home insurance rights

4. Cooperative Investigation

Keep in mind that the insurer is responsible for gathering as much information as is necessary to complete their end of the claims process, and you are responsible for cooperating with their inquiry. You are not bound to comply with unreasonable requests for information or intrusive tactics, but you must respond to claim-related queries about your loss. If you’ve already provided a recorded statement and are being requested to perform a telephone interview, you can ask for written questions to be delivered to you so you can respond in writing. 

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5. Additional Living Expenses And Loss Of Use

Insurers must provide at least 24 months of Additional Living Expenses (ALE) payments, up to policy limits, in claims where the cause is deemed a “disaster” by the state or federal government. If you reasonably experience a delay in rebuilding or replacing your house, you may be entitled to a further 12 months of ALE, for a total of 36 months. Your insurer must provide you with a list of goods that are generally classified as reimbursable ALE expenses (upon request).

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