Insurance Hour

As flames tore through Los Angeles neighborhoods this fall, the devastation quickly escalated from tragedy to history-making catastrophe. With more than $135 to $150 billion in estimated losses and tens of thousands displaced, experts now warn that this disaster could reshape California's insurance landscape for decades.

Insurance veteran Karl Susman, appearing on CBS's On Your Side, described the event as "unlike anything I've ever experienced in over three decades of doing this." His agency alone has already logged over 60 total home losses, compared to just a handful in previous wildfire years.

"This isn't just another fire season," Susman emphasized. "It's an entirely new chapter in how we understand, price, and manage risk in California."

According to early figures from the National Weather Service, the economic impact of the Los Angeles fires may reach $150 billion or more, making it one of the costliest natural disasters in U.S. history.

That total includes not just direct property losses but also ripple effects on local economies, infrastructure, and — crucially — the insurance industry itself.

Insurance claims are already pouring in from burned-out neighborhoods in Pacific Palisades, Altadena, Woodland Hills, and Malibu. Many residents remain evacuated, uncertain whether their homes survived.

"Most people don't even know the situation with their home yet," Susman noted. "They're hoping for the best, but they're still evacuated — so the number of claims we've seen is just the tip of the iceberg."

In the days following the fire's escalation, California Insurance Commissioner Ricardo Lara issued an emergency moratorium prohibiting insurers from canceling or non-renewing homeowners policies in affected ZIP codes — as well as in the areas surrounding the burn zones.

The goal: to prevent a repeat of the insurance exodus that followed previous fires in Paradise, Santa Rosa, and Napa.

"If you're in one of the affected ZIP codes," Susman explained, "you cannot be non-renewed right now. Even if your policy was canceled for non-payment, the insurer is supposed to reinstate it if you reach out and request it."

However, the key word is request. Homeowners must take action to ...

The flames sweeping through the hillsides of Los Angeles are more than just another wildfire event — they're a stress test for California's already fragile insurance system. With containment still hovering below 10% and entire neighborhoods reduced to ash, experts warn that the claims from these fires could reach tens of billions of dollars, making them among the most expensive in state history.

On Insurance Hour, host and insurance expert Karl Susman (appearing here as "Carl Sussman" in the broadcast transcript) joined live coverage to explain what these fires mean for homeowners, insurers, and the broader California market. His insights revealed both the immediate realities of the disaster and the long-term structural shifts now shaping how Californians can — or can't — get insured.

As of this broadcast, containment of the Palisades Fire was only around 8%, despite round-the-clock firefighting efforts. "We've already seen more total losses than we've ever seen in any single fire before," Susman noted. That statistic is staggering — and it has insurers bracing for what could be an unprecedented claims surge.

Each home lost represents more than bricks and mortar. It's an insurance claim averaging anywhere from $500,000 to $2 million, depending on rebuilding costs and coverage limits. Multiply that by hundreds or thousands of destroyed homes, and the financial exposure grows exponentially.

Susman emphasized that the insurance industry is now shifting from risk assessment to risk response:

"We're already at a place where we've seen more total losses than ever before. The industry is preparing to buckle down and start doing what it's been paid to do — pay those claims."

This, he added, is the test of whether recent regulatory reforms can hold under real-world pressure.

In December 2024, the California Department of Insurance (CDI) implemented sweeping regulatory reforms designed to modernize how insurers operate in the state. These changes — part of Commissioner Ricardo Lara's Sustainable Insurance Strategy — allow insurers to use catastrophe modeling and account for reinsurance costs when setting rates.

Previously, under Proposition 103, insurers were limited to using historical data — an approach that no longer reflects today's climate-driven realities. The new framework aims to strike a balance: permitting insurers to price risk more accurately while also requiring them to write coverage in higher-risk areas ...

When you wake up to red skies, air thick with smoke, and sirens echoing through canyons, the first instinct is survival. But once your family is safe and the flames begin to fade, another question emerges: Will insurance cover what's left?

As California once again faces multiple wildfires — including the Palisades, Hearst, East Eaton, and Woodley Fires — roughly 80,000 residents have been forced to evacuate across Southern California. Entire neighborhoods sit under mandatory evacuation orders, highways are closed, and even Universal Studios Hollywood has shut down due to fire danger.

On Insurance Hour, industry expert Karl Susman, president of Susman Insurance Services, joined live from the evacuation zone to provide clarity for homeowners, renters, and business owners dealing with the chaos. His insights reveal what policyholders can — and can't — do during an active wildfire and how to file claims effectively once the danger passes.

Amid the smoke and panic, one reassuring truth stands out: fire is covered under virtually every homeowners, renters, or condo policy in the United States.

"The primary peril, literally the main part of the homeowners policy, is fire coverage," Susman explained. "It would be very unusual to have a homeowners insurance or renters policy that doesn't cover fire."

That means if your home, personal belongings, or even a detached structure (like a garage or shed) is damaged by flames or smoke, your policy should respond. However, the limits of your policy — how much it will pay to rebuild, repair, or replace — depend entirely on what's listed in your declarations page.

Homeowners should review their Coverage A (dwelling), Coverage C (personal property), and Coverage D (loss of use) limits annually to ensure they reflect current rebuilding costs and living expenses.

As wildfires spread, insurance companies issue "moratoriums" — temporary freezes on writing new policies or altering existing ones in affected ZIP codes.

"When there's an active event like this," Susman explained, "insurance companies will put out an immediate bulletin that says you cannot make changes to your policy while there is an active wildfire in progress."

Southern California's hills are burning again — and so is the conversation about the future of home insurance in the state. As flames consume multimillion-dollar properties and entire communities watch the skyline glow red, the financial fallout is extending far beyond the burn zones.

In the wake of the latest wildfires, experts are warning that California's insurance market could once again be thrown into turmoil, reigniting the same fears that have haunted homeowners for years: policy cancellations, skyrocketing premiums, and the shrinking availability of coverage.

Insurance professionals like Karl Susman, a Los Angeles–based expert and host of Insurance Hour, have been warning about this exact scenario for months. Alongside other industry veterans like Michael Kiefer, the message is consistent — every catastrophic wildfire pushes California's already strained insurance ecosystem closer to the edge.

The devastation across Los Angeles County has left millions of dollars in property damage, much of it insured — but not all. Some homeowners had already lost coverage when their policies were non-renewed earlier this year, while others discovered too late that their protection was incomplete.

As ABC 10's Jane Kim reported, this latest blaze could become another turning point for the insurance industry.

"When an insurance company experiences losses above what they've predicted for the year, they're going to reassess what their rates should be in those wildfire zones," Kiefer explained. "That could in turn raise the rates. We don't know yet — but the potential is there."

This process — known as rate reassessment — is standard after any catastrophe. Carriers re-evaluate their actuarial models, adjust their expected loss ratios, and determine whether existing rates still make financial sense. The problem is, after years of increasingly destructive fires, many carriers are already at their breaking point.

When insurers face losses that exceed projections, two things typically happen:

1. Premiums increase to compensate for the new perceived level of risk.

2. Underwriting tightens, leading to non-renewals in the hardest-hit areas.

That combination — higher costs and fewer options — has already defined California's insurance crisis for the past five years. The wildfires of 2017 and 2018 set off a chain reaction that has yet to stabilize.

Wildfire season has once again ignited fear across California — and this time, the flames are threatening not just homes, but the very structure of the state's insurance system. As fires rage through the Los Angeles area, many Californians are asking a familiar question: Will this disaster make home insurance even harder to find or afford?

In a state already facing an unprecedented insurance crisis, the answer is complex — and it reaches far beyond the burn zones. Insurance expert Karl Susman, host of Insurance Hour, joined ABC10 to unpack the implications of the latest fires and what homeowners can expect as California's fragile insurance market is tested once again.

One of the most gripping moments in the coverage came from Altadena, where an ABC News crew met Lynn Levin-Guzman, an emergency room nurse spraying down her parents' home as flames from the Eaton Fire consumed neighboring houses.
"I know I'm not supposed to be here," she said, "but this is my parents' home."

Her parents, both in their 90s, had lived there for decades. Their long-time insurer had recently canceled their fire coverage — a painful example of the growing number of California homeowners left unprotected.

This single story represents tens of thousands of similar situations across the state. Once easily insured communities have become high-risk zones, where carriers either won't write policies or demand premiums that rival mortgage payments.

California's home insurance market didn't collapse overnight. Over the past decade, several key forces have converged:

• Intensifying Wildfires: Record-setting fires in 2017, 2018, and 2020 led to tens of billions in insured losses.

• High Rebuilding Costs: Construction inflation and material shortages have driven up claim payouts.

• Outdated Regulations: Proposition 103 — a 1988 consumer protection law — requires state approval for rate increases and limits how insurers can model wildfire risk.

• Carrier Retreat: Major insurers like State Farm, Allstate, and Farmers have paused or restricted new business in many ZIP codes.

By 2024, more than 30% of California homeowners were either non-renewed or forced onto th ...

The images are heartbreaking — entire neighborhoods reduced to ash, streets unrecognizable, and families standing before the remnants of homes that once held decades of memories. As wildfires continue to tear through Southern California, insurance concerns have quickly become one of the most pressing issues for displaced homeowners.

During a recent Insurance Hour appearance, insurance expert Karl Susman — himself among those evacuated — shared critical insights on how victims can take control of their recovery, even amid the chaos. His advice, grounded in decades of industry experience, helps demystify the insurance claims process and offers a roadmap for homeowners facing the overwhelming aftermath of wildfire loss.

"The very first thing I tell everyone," said Susman, "is to stop, take a deep breath, and exhale."

It's simple but profound advice. When your home is gone or your future uncertain, the natural reaction is panic. But Susman reminded listeners that the purpose of insurance — the reason we pay those premiums month after month — is precisely for moments like this.

"What's most important right now is that you and your loved ones are safe. The stuff you left behind — that's what insurance is for."

Once immediate safety is secured, homeowners should begin the claims process immediately, even if they don't yet know the full extent of their loss. Evacuated families unsure whether their homes survived the fire should still get in line early.

Susman likened it to "taking a number at a bakery."

"You want to be in the queue. The sooner you file, the sooner your claim will be assigned and moving."

After catastrophic events, insurers receive thousands of claims within days. Filing early ensures you're prioritized for adjuster contact and temporary housing benefits.

Once the claim is filed, the process can vary widely depending on the carrier. Some insurers require detailed inventories of lost property, while others issue payment up to policy limits when the loss is total.

For example:

• Partial losses may require documentation — room-by-room itemization of damaged contents.

• Total losses often qualify for immediate full-limit payments once confirmed.

However, Susman warned that policyholders working with the

As Santa Ana winds roared across Southern California, fueling blazes from the Palisades to the San Fernando Valley, more than 80,000 residents were forced to evacuate. Flames closed freeways, scorched neighborhoods, and even shut down Universal Studios Hollywood.
For thousands of Californians, this wasn't just another fire season — it was a reminder of how vulnerable the state has become to climate-driven catastrophes.

Insurance expert Karl Susman, speaking live from evacuation zones during Insurance Hour, described what he saw as "unprecedented." Multiple active fires were burning simultaneously — the Palisades Fire (3,000 acres), the Hearst Fire (500 acres), and the East Eaton and Woodley Fires, all stretching emergency resources to their limits. "People are being evacuated left and right," he said, capturing both the urgency and human toll of the disaster.

But even amid chaos, Susman's message was clear: understanding how your insurance works before disaster strikes can make the difference between fast recovery and long-term hardship.

One of the biggest misconceptions Susman addressed is the idea that homeowners must "add" fire coverage. In truth, fire is the core peril of nearly every homeowners, condo, and renters policy in the country.

"It would be very unusual," he explained, "to have any standard property policy without fire coverage as part of it."

However, the critical detail lies in timing. Once a wildfire begins, insurance companies immediately issue what's known as a "moratorium." During this period — which can last days or weeks — insurers freeze all new business and coverage changes in affected ZIP codes.

That means you cannot add or modify coverage while a fire is active nearby. No increasing limits, no switching carriers, no purchasing new policies.

"If you don't have sufficient coverage right now," Susman cautioned, "it's probably too late to make changes while the fire's in progress."

The takeaway is simple but vital: review your coverage before wildfire season. Waiting until smoke is visible means waiting too long.

When a loss occurs — whether confirmed or suspected — Susman advises homeowners to file a claim immediately. ...

When most people think about insurance, they picture the big stuff — health, home, auto, or maybe even life insurance. But as Insurance Hour host Karl Susman reminds listeners, the most devastating financial setbacks often come from the unexpected gaps between those familiar coverages. In this episode, Susman walks through real listener questions about overlooked policies — from wedding insurance and cyber coverage to hobby farms and earthquake protection — exposing how easily consumers can find themselves unprotected in critical moments.

This discussion isn't just a Q&A session; it's a roadmap for navigating modern risk. As regulations evolve and lifestyles change, so do the exposures we face. Whether you're planning a wedding, renting out a spare room, or worried about your data being hacked, these insights highlight the importance of customizing your protection.

The episode opens with a listener who's taking medical leave and wonders how time away from work might affect their health insurance. Susman explains that in the U.S., most people receive health insurance through their employer — and stepping away can create unintended coverage gaps.

If the employer doesn't continue benefits during unpaid leave, employees may need to turn to COBRA, which allows individuals to temporarily keep group health coverage after leaving employment. However, COBRA comes at a cost: employees must pay both their share and the employer's share of premiums.

Susman also notes that while some people look for "gap coverage" — short-term policies to bridge the space between plans — these are limited and often don't meet ACA (Affordable Care Act) requirements. The key takeaway: communicate with HR early and ensure you understand your continuation options before stepping away from work.

Another listener asked whether therapy and emotional wellness sessions were covered by their health plan. Susman's answer underscores how mental health benefits remain confusing, even in 2025.

While parity laws have improved access to mental health care, coverage still depends on provider type (psychiatrist vs. therapist), treatment setting (inpatient, outpatient, or intensive outpatient), and whether the professional is in-network.

Susman emphasizes that wellness and prevention — like stress counseling or mindfulness programs — are rarely covered at the same level as treatment for diagnosed conditions. Consumers should carefully review their plan's Summary of Benefits and Coverage (SBC) to understand what's included. The broader message: mental health parity in policy language doesn't always equal parity in practice.

As 2025 begins, California's property insurance landscape is undergoing its most dramatic shift in decades. After years of skyrocketing premiums, policy cancellations, and insurer withdrawals from wildfire-prone regions, new state regulations are taking effect — requiring companies to write coverage in high-risk fire zones as part of an effort to stabilize the market.

Announced by Insurance Commissioner Ricardo Lara, the reforms aim to compel insurers to return to fire-affected communities while balancing risk through updated modeling and rate flexibility. But not everyone agrees this plan will work. Critics warn that while availability might improve, prices could climb even higher.

Here's a breakdown of what's changing, why it matters, and what both consumers and the industry can expect in the year ahead.

Over the past several years, California has faced what many describe as an insurance exodus. Following devastating wildfires like Camp, Tubbs, and Paradise, major insurers such as State Farm and Allstate either paused new policies or pulled out of high-risk regions entirely.

The ripple effect was immediate and severe:

• Hundreds of thousands of homeowners were non-renewed.

• Many were forced into the state's FAIR Plan, a bare-bones "last resort" policy.

• Rates soared as homeowners scrambled for limited options.

As Susman and other industry experts have often explained, the underlying problem wasn't just fire — it was regulatory gridlock. Proposition 103, a 1988 law, gives the California Department of Insurance (CDI) strict control over pricing, often preventing insurers from adjusting rates quickly enough to match escalating risks and reinsurance costs.

"The market became unsustainable," explained insurance expert Karl Susman on Insurance Hour. "Carriers were losing money faster than the system allowed them to respond. They didn't leave because they wanted to — they left because they had to."

Effective January 2025, the new regulations require insurance companies to write policies in high fire-risk ZIP codes in proportion to their statewide market share.

In simple terms:

In this episode of "Insurance Hour," host Karl Susman dives into listener-submitted questions about insurance complexities, ranging from business interruption insurance for small businesses, liquor liability for bar owners, and cyber insurance for startups, to specific policies like flood insurance, umbrella policies for homeowners, and coverage for high-value personal items. Karl provides actionable advice on navigating various insurance policies, emphasizing the importance of honesty and clarity when discussing needs with agents. Sponsored by GEOVERA, the episode also highlights the value of earthquake insurance and explores lesser-known policy types like errors and omissions for professionals and specialty coverage for rental properties and musical equipment. The show wraps up with Karl’s signature mix of humor and practicality, ensuring listeners leave informed and entertained

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Insurance Hour is hosted by renowned insurance expert Karl Susman. Karl is a frequent guest on television stations such as ABC, CBS, Spectrum, The CW and FOX, and now his popular radio program is available online throughout California and world-wide.

Listeners can now tune in to Insurance Hour on great AM radio station KMET throughout the state of California.

In addition to traditional radio, Insurance Hour is available on several popular streaming platforms, ensuring that listeners can access the show at their convenience.

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For more information about "Insurance Hour" and its programming, please contact Lara Starr at [email protected]