Where there’s smoke there’s fire, but is the reverse true? The presumption in California could be that it is.
One fallout from the plague of wildfires that struck California in recent years is that smoke claims became a bigger issue and more often a point of contention between insurers and policyholders.
The conflict over smoke damage after wildfires led to a task force to look at smoke dama
ge claims and a new law in California designed to address the hazy area between the fire and claims on homes that are less visibly affected that involves testing and remediation, but some worry about a potential “bottleneck” in the recovery process.
California Gov. Gavin Newsom recently signed legislation establishing standards for investigating, testing and restoring smoke-damaged homes. Asse
mbly Bill 1795, the Smoke Damage Recovery Act, creates a rebuttable presumption — a legal assumption a court accepts as true unless an opposing party is able to dispro
ve it — that smoke damage was caused by a wildfire when wildfire smoke, ash, soot, char or combustion byproducts are present in a surviving residential property within a wildfire impact zone.
“The presumption in AB 1795 is principally a causation presumption, not a presumption that every surviving home in the wildfire impact zone sustained smoke damage,” explained Brandon Sipple, an attorney with the
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law firm Kennedys. “The statute applies where wildfire smoke, ash, soot, char, or combustion byproducts are present in a surviving residential property within the wildfire impact zone. When those conditions are met, the statute cr
eates a rebuttable presumption that the resulting smoke damage was caused by that wildfire.”
Other mandates of the Smoke Damage Recovery Act include:
Establishing timelines for inspections and claim handling.
Requiring repair estimates that restore homes to their pre-loss condition while
meeting health and safety standards.
Preserving policyholders’ rights to choose restoration contractors.
Establishing training requirements for adjusters handling smoke damage claims.
Protecting workers performing restoration and remediation activities.
AB 1795 directs the California Department of Insurance and the California Office of Emergency
Services to evaluate challenges posed by smoke damage and develop recommendations to strengthen protections for property insurance consumers and communities affected by future contamination events.
