The market for homeowners insurance in California has gotten tighter, more expensive, and more precarious in recent years as wildfires and other natural disasters have caused major insurers to raise their rates, retreat from the market all together, or cancel or non-renew policies for homeowners unexpectedly.
This blog considers the role that roofs — and, in particular, roof decking — play in insurers’ decisions to cancel homeowners’ policies and what recourse you have under California law if you find out your policy is being cancelled or under threat of cancellation.
Why Are Insurance Companies Cancelling Policies in California?
The rising rate of wildfires and other natural disasters combined with growing reconstruction costs have led major insurance insurance companies to significantly scale back the amount of business they do in California. Seven of the 12 biggest residential insurance companies in the state have either cut existing homeowners insurance policies or stopped selling new policies in California within the last three years. This has led more homeowners than ever before to turn to the California FAIR Plan, the state’s insurer of last resort.
Can a Home Insurance Company Make You Replace Your Roof?
The condition of the roof of a home is integral to the overall structural integrity of the rest of the house. It’s not uncommon for insurers to require roof repairs as a condition of renewal for a homeowners insurance policy if the roof has been damaged or if it’s nearing the end of its lifespan.
However, in California there has been a significant recent increase in the number of homeowners reporting that their insurance company either threatened to cancel or wouldn’t renew their policy because of the condition of the roof. This places homeowners in the position of having to quickly make costly repairs or find another insurer.
How Old Can a Roof Be Before an Insurance Company Claims It’s Too Old?
While different roofing materials have different lifespans, most insurance companies won’t cover standard asphalt shingle roofs that are more than 20 years old. However, this doesn’t mean your insurer will automatically drop you once your roof hits that age. As your roof ages, insurers may respond by:
- Increasing your premiums
- Reducing your coverage (they might only reimburse the actual cash value of the roof, rather than the full replacement cost)
- Requiring an inspection
- Refusing to renew your policy unless the roof is replaced
What Is Roof Decking?
Underneath the shingles of a roof is the load-bearing structure often made of plywood called the “deck,” which provides a solid base for the shingles and other roofing components. When insurers are determining the condition of your roof, the age and condition of the roof deck is one of the components they will consider.
The roof deck is a necessary component part of an overall roof assembly and must be considered when estimating the cost to replace a hail-damaged roof system. The National Roofing Contractors Association (“NRCA”) is the standard in the roofing industry for technical assistance. The NRCA Roofing Manual: Architectural Metal Flashing, Condensation Control and Reroofing — 2010, consists of three primary sections. Chapter Four of the Reroofing section, labeled “Roof Decks for Reroofing,” provides that:
- A deck, as part of a roof assembly, needs to provide structural support and be the substrate for the roof assembly;
- A roofing contractor must ensure that a deck’s surface condition is suitable for application of new roofing materials, including shingles;
- Before applying new roofing materials, the deck should be inspected to determine that it is smooth, straight, and free of irregularities, such as significant humps or depressions; and
- If the deck is damaged such that it is unsuitable for application of new roofing materials, then it needs to be replaced before applying such new roofing materials.
When Can an Insurance Company Cancel Your Policy in California?
According to the California Department of Insurance’s Residential Insurance Handbook, “After a residential policy has been in effect for sixty days, the insurance company can only cancel a policy for reasons specified by law, which include: nonpayment of premium, fraud, material misrepresentation, or physical changes in the insured property that increase any hazard insured against.”
There are also restrictions on the notice of cancellation or nonrenewal the insurance company must give you. “The company must mail or deliver a notice of cancellation to you at your last known address at least 20 days prior to the effective date of cancellation, and 10 days for nonpayment of premium or fraud.”
In the case of nonrenewal, “a written notice of nonrenewal must be forwarded to you at least 75 days before the expiration date. If the company fails to give you the proper notice required by law, your existing policy, with no change in its terms and conditions, will remain in effect for 75 days from the date the notice is sent.”
Can You Fight An Insurance Cancellation?
If your insurance policy is cancelled in a manner that violates the stipulations mentioned above, or if you otherwise think that your insurance company has dealt with you in bad faith, there are a number of different avenues to pursue.
First off, you can contact your agent for more information about why the policy is being cancelled or file an appeal with the insurance company. You could also file a complaint with the California Insurance Department.
Seeking the assistance of an insurance law firm like Merlin Law Group can help you explore your legal options. In addition to suing, an attorney can help you appeal a decision or negotiate with your insurer.
Further Resources on Insurance Coverage Law
Navigating the complexities of insurance claims can feel overwhelming. Whether you’re facing unpaid claims or simply filing for the first time, our eBooks equip you with the crucial information you need to advocate for yourself with confidence.
- Filing A Property Insurance Claim
- Insurance Company Response Time
- What To Do When You Have a Denied/Underpaid Claim
- Wildfire Claims
- Flood Claims Handbook
- More Information on Hurricane Deductible and Policy Limits
- Condominium Hurricane Preparedness
Why Merlin?
Are you fighting an insurance company that won’t pay out on claims? With nearly 40 years of practice and $2 billion in recovered claims, our team stands by your side to ensure you can face any insurance challenge with confidence. Contact us today for a consultation, or read more about how we act as your trusted advocate.
