Six Months Later, Fire Victims Still Fighting Insurance Company

Homeowners Say Insurance Company Won't Pay Personal Property Claims Without an Inventory

Monday marked six months since the first full day of the firestorm that destroyed entire neighborhoods in Napa and Sonoma counties. But half a year later, some families say they are still unable to move on, and they blame roadblocks from their insurance company.

After NBC Bay Area reported in January on the plight of a homeowner locked in a dispute with State Farm Insurance, we heard from more residents of Santa Rosa, who all said they were having difficulty getting their claims paid in full.  Together, with Telemundo 48, NBC Bay Area extended an open invitation to meet members of that group one weekend. 

The response was overwhelming.

At least 55 people said they would be there - but more than twice that many filled the First United Methodist Church on March 24.

We asked the crowd, "Please raise your hand if you lost everything.”  Every hand in the room was raised. Everyone at the meeting lost their homes to the fire.

They have something else in common -- all their homes were insured by State Farm, and everyone who spoke with NBC Bay Area said they feel State Farm is shortchanging them.

We asked the audience, "Who here got everything they expected out of their insurance policy?"

No hands went up.  “That’s nobody.”

Here's why: They say State Farm is requiring them to do a detailed, item-by-item inventory of the contents of their home in order to get 100 percent of their coverage. They can forgo the itemized list, but then State Farm will reduce their payout by 25 percent.

That doesn't sit well with homeowner Bill Vosburg.  “I paid my premiums on 100 percent, and State Farm ought to pay me 100 percent of my content, without a full inventory," he said.

Lots of money is on the line, tens of thousands of dollars for most families.  Some say six figures are in limbo, at the mercy of their memories and a line-by-line inventory.

They could not have made it more difficult for us to do these inventories as well,” Bob Cheal, another fire victim, told NBC Bay Area.

Policyholders shared with NBC Bay Area a recent letter they received from State Farm that suggests California code has required an inventory "for some time." But the California Department of Insurance told us it does not require the detailed contents inventory that State Farm is demanding.

“It’s not statutorily required,” said Dave Jones, California Insurance Commissioner, in a January interview with NBC Bay Area.

Jones' office reaffirmed that insurance companies may waive inventory requirements and pay policyholders 100 percent.

“Some insurers have waived it for North Bay fire survivors," Jones said in January.  "I’m confident they can all waive it."

State Farm declined our request for an interview. It provided the following written statement in response to our inquiries:

“State Farm is committed to helping our customers recover from the tragic wildfires. State Farm has agreed to and is following the Department of Insurance expedited claims process for these wildfires, including increasing the amount of contents coverage paid up front (75 percent) without requiring an inventory. The insurance contract provides coverage for items a customer has actually lost, up to the policy limits.”

Right after the fires, California insurance regulators did ask insurance companies to settle claims without an inventory. But the state didn't limit them to paying 75 percent. In fact, in a December notice, Jones applauded some companies for paying up to 100 percent. He asked all companies to do the same, but he couldn't demand it. Jones does not have the legal authority to require 100 percent payouts after a disaster.

State Farm told NBC Bay Area the required inventory is "a simple listing of what was lost." But many fire victims complain it's not simple at all. They said the software they must use is glitchy and cumbersome. 

State Farm said it assigned specialized workers called adjusters to help survivors. It called the process "a personalized experience." But most policyholders who spoke with NBC Bay Area in Santa Rosa said they've had five or more different adjusters in six months.

Among the fire victims at the meeting was Elsa Hernandez. A teacher, she's raising a family in Santa Rosa with her husband Luis.

Hernandez said their claim is being reduced by $60,000, unless they complete an inventory of what was lost.

"My priority is rebuilding," Hernandez said.

The couple invited NBC Bay Area to visit the empty lot where their Coffey Park home once stood. They wanted us to see firsthand how their life is on hold.  They say they want State Farm executives to do what NBC Bay Area did: visit them.

“We’re not trying to get any more than what we feel is rightly ours," Hernandez said. "We’re not lying when we say we’ve lost it all. You can come out and see.”

Dr. Diane Malnekoff, a licensed psychologist, says the inventory process can retraumatize fire victims.

“It’s constant stress," Malnekoff said, "and a constant tension.”

Malnekoff said she saw a lot of it in the church. She also knows it firsthand;  Malnekoff lost her home in the firestorm. She's also a State Farm customer, and she's trying to remember everything she lost in her home.

“I think all of it’s unnecessary," Malnekoff said. "It would have been such a relief if the insurance company just came in and said we’ll give you this. And we’re done, and now you can move forward. There’s no moving forward.”

In January, State Farm told NBC Bay Area the dollar amounts listed in its policies are maximum benefits, not automatic payments. Here's what that means: You might think you're insured for, say, $300,000, but really, you're insured for up to $300,000. You might have to fight to get 100 percent of that payout in the event of a total loss.

Here's how to protect yourself: Do a home inventory, now. Take photos or video in every room. Document everything you own. Then, save those files to the cloud for safekeeping.

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