The Homeowner’s Insurance Reform Act of 2013 is law. Dale Snyder, who lost his home in Rist Canyon in the High Park Fire last June is rightfully proud of his efforts to get the act passed. His neighbors in the foothills west of Fort Collins are grateful, and Snyder says he is a whole lot wiser.
Snyder, a retired home builder, spent most of the past year researching, cajoling and arguing for the rights of victims of the High Park Fire. “You can’t imagine the amount of time it took,” he says.
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He sees the reform act as the end of round one, but he’s not sure how much further he will pursue changes. State Reps. Clare Levy, D-Boulder, and Randy Fischer, D-Fort Collins, sponsored the bill in the House and Sens. John Kefalas, D-Fort Collins, and Jeanne Nicholson, D-Georgetown, sponsored the bill in the Senate.
The Insurance Reform Act allows victims more time to make claims, the possibility of increased additional living expenses, mandatory policy updates every two years, and guarantees that policies be written in plain language.
One thing Snyder wishes had happened is inclusion in the act of the Value Policy Law, currently in effect in 19 states, that pays the limits quoted in an insurance policy for the dwelling and its contents without the need for homeowners to inventory their property. Currently only a small portion of total value is paid out when an inventory is not submitted. Snyder was told by one insurance agent he interviewed that insurance companies save an average of 30 percent by requiring inventories.
Value Policy is not a new concept. The Colorado legislature voted in favor of such a law in 1899, only to have the governor veto it. Snyder has learned that the law works well in the states where it is in effect.
Kefalas, who held a public meeting last August for fire survivors, has been a prime mover in crafting the bill. “We worked to create a bill that did not have unintended consequences, such as the raising of homeowner’s insurance rates,” Kefalas says.
He sites as an example the additional living expense provision. The group that lobbied for a mandatory 24-month provision were denied because of the likelihood of added cost. Instead the standard remained at 12 months with a mandatory offer of 24 months. Kefalas says insurance rates will not rise because of the reform act, but he warns that they are going to rise because of the increased possibility of severe events — whether it be floods, hailstorms or fires in the state.
Rocky Mountain Insurance Information Association lobbyist and spokeswoman Carole Walker said the reform act strikes a reasonable balance between insurance companies and the insured. She praised bill sponsors, legislators and citizens for their collaborative efforts. Walker says insurance companies remain neutral about the reforms. New regulations are among the most stringent in the country, including California. Colorado is now listed among the top 10 states in the nation for catastrophes, and this fact is likely to result in rising insurance rates for the state.
Walker is taking a “wait and see” attitude about the possibility of rates rising for all Colorado homeowners. She warns that insurance rates are rising across the board and that there is a possibility of rate hikes related to the Colorado fires of last summer.