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29
Apr

California Wildfire Lawsuits Uncover Disaster

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California Wildfire Lawsuits Uncover Disaster

California wildfire lawsuits

Two new lawsuits filed in Los Angeles are shining a spotlight on a worsening insurance crisis in California. Complaints allege that major home insurance companies, including State Farm, have colluded to limit coverage in wildfire-prone communities, forcing homeowners onto the state-run FAIR Plan. This last-resort plan offers only basic coverage and comes with high premiums, leaving thousands of policyholders underinsured and financially vulnerable after recent disasters.

Allegations of a Coordinated Industry Pullout

According to one of the lawsuits, insurers engaged in an “illegal scheme” by simultaneously withdrawing or halting new business in fire-prone areas beginning in early 2023. The lawsuit, filed on behalf of homeowners who lost their homes in the devastating January wildfires, claims this coordinated retreat violated California antitrust and unfair competition laws. The wildfires destroyed nearly 17,000 structures and resulted in at least 30 fatalities, leaving survivors struggling to rebuild with insufficient coverage.

The second lawsuit seeks broader damages for any policyholder forced onto the FAIR Plan after January 2023. The FAIR Plan caps residential coverage at $3 million, which for many homeowners falls far short of the cost to replace or rebuild homes in California’s inflated real estate market.

“By colluding to push plaintiffs and so many like them to the FAIR Plan, the defendants have reaped the benefits of high premiums while depriving homeowners of the full coverage they were ready, willing, and able to purchase,” said attorney Michael J. Bidart, representing the homeowners (KCRA News).

The FAIR Plan: Meant to Be Temporary, Now a Lifeline

The California FAIR Plan is an insurance pool funded by private insurers and designed for homeowners who cannot attain traditional coverage. While intended as a short-term solution, the plan has seen explosive growth. As of March 2025, over 555,000 California homes are insured under FAIR—more than double the number in 2020.

One reason insurers may be driving homeowners toward FAIR is that they do not bear the full burden of financial liability for FAIR payouts. After California’s top insurance regulator ordered insurers to contribute $1 billion to help the plan cover wildfire-related losses, a controversial provision allowed half the cost to be passed onto policyholders statewide. This sparked yet another lawsuit, challenging the legality of the surcharge.

Industry Response and Regulatory Challenges

Insurers argue that their decisions stem from the increasing difficulty of pricing risk due to climate change. As wildfires grow in frequency and intensity, insurers claim they must adjust their exposure to stay solvent. The American Property Casualty Insurance Association called the lawsuits “meritless,” stating that they comply with California antitrust laws and work to solve long-term challenges in the insurance market.

Meanwhile, California’s Department of Insurance has introduced regulations to encourage companies to return to high-risk areas. These include allowing insurers to factor climate risk and reinsurance costs into premiums—a move that may raise rates across the board but potentially restore access to coverage for at-risk homeowners.

“Californians deserve a system that works—one where decisions are made openly, rates reflect real risk, and no one is left without options,” said Gabriel Sanchez, spokesperson for the department (KCRA News).

What This Means for Policyholders 

At the Chad T. Wilson Law Firm, we’ve closely monitored how insurance carriers respond to climate-driven disasters—and we’ve consistently seen a troubling trend: delayed claims, dropped policies, and a growing reliance on state-backed, bare-bones insurance plans.

The case in California is just one part of a national issue. From wildfires in the West to hurricanes in the Gulf and hailstorms in the Midwest, property owners across the country are discovering that the insurance they thought would protect them no longer meets their needs.

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If your insurance claim has been denied, delayed, or underpaid—or if you’ve been forced into a limited policy like a FAIR Plan—you are not without options. Our firm stands ready to challenge bad faith practices and ensure policyholders receive the full compensation they’re owed.

21
Apr

Minnesota Homeowners Face Shrinking Insurance Coverage

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Minnesota Homeowners Face Shrinking Insurance Coverage

As severe weather season approaches in Minnesota, many homeowners are taking a closer look at their property insurance—only to find that coverage isn’t what it used to be. According to a recent report by CBS Minnesota, insurance companies in the state are quietly rolling back protections, increasing deductibles, and limiting how storm-related damage—particularly roof claims—is handled.

Unfortunately, this trend isn’t unique to Minnesota. At Chad T. Wilson Law Firm, we’ve seen these tactics play out in Texas, Colorado, Florida, and California, where insurers have responded to rising climate-related losses by cutting corners—often at the expense of the very policyholders they promised to protect.

With extreme weather events becoming more frequent and insurance companies pulling out of Texas, residents are facing tough decisions. Some are forced into the Texas FAIR Plan, a last-resort insurance option for those denied coverage, while others are considering going without insurance entirely—a risky gamble in a state prone to hurricanes, tornadoes, and hailstorms.

The Shifting Landscape of Roof Coverage

One of the biggest changes Minnesota homeowners are now facing? A dramatic shift in how insurers handle hail damage and roof claims.

“Hail losses, specifically as it relates to roofs, are some of the biggest cost drivers right now,” said Aaron Cocking, an insurance industry lobbyist. To recoup losses, insurance companies are increasingly prorating roof claims—meaning the amount they’ll pay depends on the age of your roof—and applying separate deductibles based on damage type, rather than using a single, standard deductible.

This practice mirrors what we reported in Texas, where we covered how increasingly complex policy language and selective coverage limitations are leading to widespread confusion—and in some cases, outright denial of valid claims.

Homeowners Are Often Unaware Until It’s Too Late

“Many homeowners think, ‘I’ve got home insurance—I’m covered,'” said Cocking, “but they don’t actually read into it.”

This is a dangerous assumption, and one that’s exploited all too often. As noted in our recent coverage of the Texas insurance crisis, more and more policyholders are learning—after damage occurs—that their policies exclude or drastically underpay storm-related repairs.

Dan Walrach, a Minnesota-based contractor, echoed this concern. “Read your policy,” he advised. “If you don’t know how to read your policy, find someone to help you read it.”

What Homeowners Should Do Now

This is sound advice for anyone living in a storm-prone region. Here are key steps every homeowner should take to protect themselves:

  • Review Your Policy Now – Don’t wait for damage to happen. Know your deductibles, exclusions, and whether your roof is covered at replacement cost or actual cash value.
  • Ask Questions – Contact your agent and ask specific questions about hail, wind, and water damage.
  • Document Everything – Take photos of your roof and exterior now, before storm season, as a baseline for future claims.
  • Know Your Rights – If you feel a claim has been unfairly denied, underpaid, or delayed, contact a qualified insurance attorney.

How Chad T. Wilson Law Firm Can Help

At Chad T. Wilson Law Firm, we specialize in helping policyholders fight back when insurance companies fail to honor their contracts. Whether you’re in Minnesota, Texas, or any other storm-prone state, we understand how to navigate complex insurance disputes and hold carriers accountable.

If your claim has been denied, delayed, or underpaid, contact us for a free case evaluation. We don’t get paid unless you do.

03
Apr

Texas Homeowners’ Insurance Crisis

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Texas Homeowners Face an Insurance Crisis: Rising Rates and Tough Choices

The cost of home insurance in Texas is skyrocketing, leaving many homeowners struggling to keep their coverage—or even questioning if they should keep insurance at all. A recent ABC13 Houston investigation found that insurance rates in the state have soared in recent years, with some homeowners seeing their premiums increase by 25% annually—a trend that has made homeownership more expensive and uncertain.

With extreme weather events becoming more frequent and insurance companies pulling out of Texas, residents are facing tough decisions. Some are forced into the Texas FAIR Plan, a last-resort insurance option for those denied coverage, while others are considering going without insurance entirely—a risky gamble in a state prone to hurricanes, tornadoes, and hailstorms.

How Bad Is the Insurance Crisis in Texas?

For homeowners like John Cobarruvias, who has lived in Clear Lake since 1989, the increases are unsustainable. He once paid $750 per year for home insurance with a $500 deductible. Today, his premium has skyrocketed to $6,000 annually with a $9,000 deductible—making him question whether keeping insurance is even worth it (ABC13 Houston).

Cobarruvias isn’t alone. ABC13 Investigates analysis of Texas Department of Insurance data found that the number of rate increases by insurance companies has more than doubled over the past decade. Even more concerning, the state found no issues with most of these increases, meaning homeowners have little recourse to challenge these soaring costs.

Why Are Texas Home Insurance Rates So High?

There are several reasons why Texas homeowners are experiencing these extreme rate hikes:

  • More Frequent & Severe Weather Events

    • In 2023 alone, Texas experienced 20 major weather disasters, including hurricanes, severe storms, and wildfires, totaling over $20 billion in damages.

    • Insurance companies say these disasters have increased claim payouts, leading them to raise rates or stop offering coverage in high-risk areas.

  • Insurance Companies Control the Pricing System

    • Unlike some states that require prior approval before insurers raise rates, Texas allows a “file and use” system—meaning insurers can raise rates first and justify them later.

    • Consumer advocates, including Texas Watch Executive Director Ware Wendell, argue that this system leaves homeowners vulnerable to overpricing.

  • Soaring Costs of Labor & Materials

    • Inflation has driven up the price of home repairs and rebuilding, leading insurers to adjust their premiums accordingly.

    • As Wendell puts it: “If lumber costs more, then the insurance that you buy to protect your home is going to cost more.”

What If You Can’t Get Insurance?

For homeowners who can’t find affordable coverage, the Texas FAIR Plan is often their only option. Created by lawmakers as a last-resort insurer, it provides basic coverage for Texans who are denied policies elsewhere.

The problem? It’s not a long-term solution.

  • At the end of 2024, the Texas FAIR Plan had 61,774 policies statewide—with the highest concentration in Harris, Fort Bend, and Galveston counties.

  • Homeowners like Robert Dempsey have struggled to find private insurers still operating in the state. After being dropped by his provider, he had to shop around extensively before securing coverage—at a much higher rate.

Are Texans Dropping Insurance Altogether?

Some homeowners are considering going without insurance, especially those who have already paid off their homes.

Cobarruvias, who has only filed two claims in 30 years, is debating whether to self-insure—setting aside money instead of paying rising premiums.

“We would take that money and put it into an account. Hopefully, after five or six years, we’ll be able to cover the cost of repairs,” he explained.

But this is a major gamble, especially in a state that frequently experiences hurricanes, floods, and hailstorms. One major disaster could wipe out a homeowner’s savings and leave them in financial ruin.

What Can Homeowners Do?

If you’re facing an insurance crisis in Texas, here are a few steps you can take:

✔️ Shop Around – While the market is tight, comparing quotes from multiple providers can sometimes lead to better rates.

✔️ Consider Discounts – Some insurers offer discounts for bundling policies or investing in home improvements like impact-resistant roofs.
✔️ Review Your Coverage – Make sure your policy covers what you need, but also look for areas where you can cut unnecessary coverage.
✔️ Consult an Insurance Attorney – If you’ve been dropped, denied, or underpaid, seeking legal guidance can help you fight for fair treatment.

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How Chad T. Wilson Law Firm Can Help

At the Chad T. Wilson Law Firm, we fight for policyholders when insurance companies fail to uphold their promises. Whether you’re facing:

  • A denied or underpaid claim

  • A sudden non-renewal

  • Unjustifiably high rate hikes

Our experienced attorneys are here to help. We don’t get paid unless you do, so there’s no risk in reaching out for a free consultation.

Has your insurance company denied or underpaid your claim? Contact us today!

Source:

ABC13 Houston