California Insurance Commissioner Dave Jones has issued a formal notice to all property and casualty insurers as a reminder to honour mudslide, landslide, and debris flow claims if the wildfire can be shown to be the cause.
“Californians have suffered greatly with all of the devastating losses from wildfires that struck the state in the last three months of 2017,” said Commissioner Jones.
He said “preliminary indications are that the Thomas Fire burned vegetation which would otherwise have absorbed rainfall and held soils in place, which in turn resulted in the mudflows, mudslides, debris flows or landslides.
“If the evidence shows the Thomas Fire or another peril covered by a homeowner’s insurance policy was the efficient proximate cause of mudflow damage, I expect insurance companies to step up and cover these financial losses.”
General homeowners’ insurance policies exclude flood, mudslide, debris flow and other similar events, however, Jones put insurers on notice that both the Insurance Code and case law have established the legal doctrine of “efficient proximate cause”.
This means if the facts show the Thomas Fire, a covered peril, was the cause of the subsequent mudflow, mudslides, debris flow, landslide, or other similar event, then damage caused by those events should be covered under the property owner’s insurance policy.