Insurance brokers learn to showcase Insurance brokers and agents who serve the North Bay are looking to explain the benefits of changes that property owners are making to insurers. They describe such actions as “leaning into mitigation.” “Having a detailed explanation of your wildfire mitigation efforts to share with your broker is extremely helpful. While some properties have gone to great lengths to minimize risk, the insurance market remains challenging. [It] is not providing the level of discounts property owners need to reduce their costs” says Debra Costa, senior vice president and vintner practice leader at Heffernan Insurance Brokers. The company is headquartered in Walnut Creek and has offices in Napa and Petaluma. Insurers often limit the amount of risk they carry for certain zip codes, like 94574, which covers areas directly east and west of Highway 29 near St. Helena. Once insurers hit this limit, they often stop writing new policies. “This is why we work with clients well in advance of their renewal dates. We also advise clients to develop a recovery plan for certain elements of their business to avoid substantial loss of income,” says Martha Bane, managing director of property practice and a principal in the Real Estate and Hospitality practice for Gallagher. Gallagher is a global insurance brokerage firm headquartered in Illinois that has clients in the North Bay. The supply chain for construction materials and equipment has now recovered from disruptions. Still, having a plan in place is a good tip for business owners. Demand for rebuilding and measures to continue business operations can surge after a severe wildfire. Another option for business owners is to buy coverage from a non- admitted insurer. This type of insurer does not follow the same state regulations as an admitted insurer. The advantages of working with a non-admitted insurer are that it can currently use predictive wildfire
modeling and alter policy prices without state review. Non-admitted insurers can be more willing to take on customers in the North Bay. They may offer policies at lower prices than admitted insurers. “Delos Insurance Solutions, which is based in San Francisco, currently offers home insurance policies for property owners in areas where wildfires are common. We are looking to move into commercial property insurance,” says Andrew Notohamiprodjo, head of data at Delos Insurance Solutions. Delos recommends its customers ask local governments and Fire Safe Councils to utilize broader measures to decrease risk, like controlled burns. “Our research has found that it might take community level changes to mitigate wildfire exposure. Those changes could give us the ability to write more policies and decrease premiums for a given area,” says Notohamiprodjo. There is hope in the next five years that fire prevention efforts by Cal Fire, cities, counties, large private property owners and Fire Safe Councils will regularly show up in admitted and non-admitted insurers’ models. “That’s why using predictive modeling is helpful. It’s also why individual and group progress on everything from wood chipping to forest fuel reduction makes a difference in pricing,” says Notohamiprodjo. g
36 NorthBaybiz
December 2024
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