East Troublesome victims inspire state bill meant to improve wildfire insurance process
A bipartisan bill motivated by the insurance struggles of East Troublesome Fire victims is making its way through the Colorado General Assembly.
On Thursday, HB22-1111 passed the House Business Affairs and Labor Committee tonight by a vote of 10-2. The bill, meant to protect Coloradans with wildfire insurance by updating standards, is being sponsored by Rep. Judy Amabile, a Democrat representing District 13 including Grand County, and Sen. Bob Rankin, a Republican representing District 8 including Grand.
Amabile, a member of the committee, introduced the bill on Thursday, referencing a town hall she and Rankin held in Grand County back in June.
“We heard from a lot of people at that town hall that they had really suffered a second trauma after losing their homes, and that trauma was figuring out how to get their claims processed and how to get paid what they felt they were owed from their insurance policies,” Amabile said.
As presented, the bill establishes new coverage requirements that apply in the event of a loss of a residence due to a declared fire disaster. The main intention of the bill is to ensure consumers’ claims are paid in timely manner.
The bill would update a 2013 law standardizing what insurers will pay out in claims for lost property and additional living expenses after a declared fire disaster. One of the biggest changes would be increasing how much insurers would be required to pay disaster victims up front — up from 30% to 65% of the value of the contents of the home without requiring a comprehensive inventory.
Many East Troublesome Fire victims testified at the committee hearing, noting how this sort of law would have assisted them through the recovery process.
Natascha O’Flaherty, an attorney with McDonough Law who has helped a number of clients navigate the insurance process following the East Troublesome Fire, said over the phone Friday that the changes would help expedite and streamline the claims process, while allowing for a more realistic timeline to rebuild.
“It solves so many problems that were exposed in the Troublesome Fire claims,” she said.
O’Flaherty pointed out that the large demand for reconstruction following a major fire event, coupled with limited resources in rural areas makes the two year rebuilding time frame incredibly difficult.
At the end of 2021, the year after the East Troublesome Fire, only 94 building permits had been issued for the 378 homes that were lost in the October 2020 fire.
“Post-fire when there’s so many homes lost, the shortage of builders, building supplies, contractors — people need more time,” O’Flaherty said. “Up here in rural areas, where the building season is short — East Troublesome happened Oct. 21 and then came the snow — people couldn’t even clear their lots until the following spring and start building.”
Along with a longer timeline to rebuild, the bill would extend payouts of additional living expenses, the insurance that covers the additional costs incurred by a displaced homeowner. It would also require consumers have a single point of contact with their insurance company — O’Flaherty has a client who is now working with their 14th adjuster since the fire.
“It’s so sad that we have to legislate basic and good claims practices,” she said. “That’s really all this bill does.”
Amabile, from Boulder, said that while some might worry that this bill comes too soon following the Marshall Fire, this bill is meant to help the victims of the next major wildfire as Colorado sees worsening natural disasters.
“What happened in Marshall fire is actually inevitable and it will continue to happen,” Amabile said. “That’s why even though this bill won’t help the people in the Marshall Fire and it won’t help the people in the East Troublesome Fire, it will help the people in the next fire.”
The bill still has a way to go before it can become law and has been referred to the Committee on Appropriations.
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