How to Protect Your Rights After Losing Your Home or Business in the Los Angeles Wildfires

Losing your home or business in a wildfire is more than just a financial setback—it’s an emotional and logistical nightmare. As you try to pick up the pieces, you may find yourself dealing with insurance companies that delay or underpay claims, unclear legal options, and an overwhelming amount of paperwork and red tape. If you’re struggling with the aftermath of the Los Angeles wildfires, knowing your rights can make a difference in securing the compensation you need to rebuild your life.

Even if you do not have fire insurance, you may still have legal options. Some fires are caused or worsened by utility companies, government agencies, or gas providers failing to maintain infrastructure. If a third party is responsible for your losses, you may be able to file a wildfire insurance claim against them.

Recovering after a wildfire comes with financial and legal challenges, from dealing with insurance companies to exploring other potential claims. Insurance attorney Sean Shamsi has helped many fire victims fight for fair compensation, ensuring they understand their rights and available options. If you’re facing delays, underpaid claims, or uncertainty about your next steps, knowing what to do can make all the difference. In this blog, he outlines key protections, legal considerations, and strategies to help you move forward.

What Homeowners and Business Owners Can Claim After a Wildfire

Your insurance policy may provide compensation for a wide range of losses. However, insurance companies do not always pay out the full amounts policyholders expect, and many victims may be unaware of additional benefits included in their policies.

Homeowners May Be Eligible for:

• Replacement Costs: Rebuilding or repairing your home to pre-fire conditions, subject to policy limits
• Additional Living Expenses (ALE): Coverage for temporary housing, meals, and other costs while your home is uninhabitable
• Personal Property Coverage: Reimbursement for lost or damaged belongings
• Debris Removal: Clearing fire-damaged property to prepare for rebuilding
• Rebuilding in a New Location: Some policies allow rebuilding elsewhere if returning to the original site isn’t feasible

Business Owners May Be Eligible for:

• Business Interruption Coverage: Compensation for lost income and ongoing expenses while your business remains closed
• Property Damage: Replacement of commercial buildings, inventory, and equipment
• Extra Expenses: Costs related to setting up temporary business operations
• Civil Authority Coverage: Compensation if a government-mandated closure disrupts operations
• Employee Wages: Coverage for payroll if included in the policy

Dos and Don’ts When Dealing with Insurance Companies

Insurance providers have a legal duty to process claims fairly, but many policyholders face delays, low settlement offers, or outright denials. Taking the right steps early on can strengthen your wildfire insurance claim.

What to Do

• File Your Claim Promptly: Notify your insurer as soon as possible.
• Document Every Loss: Take photos and videos of all damage before cleaning up.
• Request a Copy of Your Policy: Review it for coverage details, including ALE and business interruption benefits.
• Keep Written Records: Document all interactions with your insurer, including emails and call logs.
• Ask for an Advance: Request a partial payment to cover immediate needs. In light of recent directives from the California Department of Insurance, Commissioner Ricardo Lara has ordered insurance companies to provide advance payments on claims to expedite recovery for wildfire survivors. Policyholders who have suffered a total loss are entitled to advance payments for personal property and additional living expenses. For instance, insurers are required to render an advance payment of no less than four months of living expenses upon request.
  
  Additionally, under California law, insurers must offer an advance payment for personal property losses without requiring a full itemized inventory. Policyholders are entitled to receive at least 30% of their dwelling coverage limit, up to $250,000, without listing every lost item. This is meant to help victims replace essential belongings without unnecessary delays. Some insurers may also allow policyholders to combine structure coverages, meaning funds allocated for separate structures (e.g., garages, sheds) can be used toward rebuilding the primary residence.

• Notify Your Mortgage Lender or Landlord: Homeowners should inform their mortgage lender about property damage, while renters should notify their landlord as soon as possible.
• Prevent Further Damage: If safe to do so, take temporary measures to prevent additional harm, such as covering openings with tarps or boarding up exposed areas. Keep receipts for any emergency repairs, as they may be reimbursable.
• Seek Professional Support: A public adjuster or insurance attorney can assist if you experience delays or low settlement offers.

What to Avoid

• Signing Documents Without Review: Do not sign any settlements or waivers without understanding the full implications.
• Throwing Away Damaged Property: Keep everything for inspection.
• Accepting the First Offer: Initial settlements may be lower than what you are owed.
• Delaying Your Claim: Missing deadlines could prevent you from recovering compensation.

California Laws Protecting Wildfire Victims

State laws require insurers to act in good faith and offer fair compensation for wildfire claims. Some of the most important regulations include:

• California Fair Claims Settlement Practices Regulations: Insurers must process claims within specific timeframes.
• SB 872: Allows wildfire victims up to 36 months to use ALE benefits in disaster-declared areas.
• Bad Faith Protections: If an insurer wrongfully denies or delays a claim, you may have grounds to sue for bad faith practices. Insurance companies are required to:
  • Acknowledge receipt of your claim within 15 days
  • Investigate your claim within 30 days
  • Offer an undisputed claim settlement within 40 days
  • Provide policyholders with a clear explanation if any portion of the claim is denied

If an insurance company fails to meet these deadlines or delays your claim without valid justification, you may have grounds for a bad faith lawsuit under California law.

• Statutory Time Limits: Homeowners and business owners generally have two years to sue for property damage or bad faith insurance practices. If filing claims against government entities, victims must act within six months.

For more on California insurance regulations, visit: https://www.insurance.ca.gov.

What to Do If Your Claim Is Denied or Undervalued

If your insurance company denies or undervalues your claim, you still have options:

• Request a Re-Evaluation: Provide additional evidence and documentation to support your claim.
• Engage an Independent Appraisal: You have the right to request an independent assessment if you disagree with the insurer’s valuation.
• Keep Detailed Records of Insurance Adjuster Communications: Write down the date, time, and details of every conversation with your adjuster. Confirm verbal discussions in writing through follow-up emails to create a paper trail. This documentation can be valuable if you need to appeal or dispute your claim.
• Pursue Legal Action: If your insurer fails to act fairly, legal action may be necessary to recover what you’re owed.

Take Action Now

Recovering after a wildfire is an uphill battle, but California law provides key protections to help victims rebuild. Understanding your rights under state law—such as advance payments for temporary living expenses, extended rebuilding deadlines, and flexibility in using your insurance benefits—can make a difference in how quickly and fully you recover. If your insurer fails to meet these obligations, you may have legal options to challenge them.

In our next blog, “Can You Sue for Damages After the LA Wildfires? Your Legal Options Explained,” we’ll discuss third-party claims against entities like Southern California Edison, local governments, and gas companies that may have contributed to the fires.  State investigations are still ongoing, and legislative changes in 2025 could expand liability for utility companies in wildfire-related claims. If you’re wondering whether you can hold another party accountable for your losses, be sure to check out that article.

Lost Your Home or Business to a Wildfire? Get the Help You Need

Losing your home or business and recovering from wildfire damage is overwhelming, but you don’t have to face insurance battles alone. With decades of experience in fire property damage insurance claims, The Shamsi Law Firm, APC fights to resolve claims on behalf of fire damage victims in North Hollywood and the surrounding areas in Los Angeles County and Southern California.

We handle first-party claims and third-party claims for fire damage, including claims arising from accidental house fires, arson, or wildfires in Southern California. We know how insurance companies operate and will fight to ensure you receive a fair outcome in your wildfire insurance claim.

Your online search for a “fire damage attorney near me,” brought you to this blog. Take the next step and schedule your free consultation with an insurance attorney who understands the challenges you’re facing. Call (818) 764-7640(818) 764-7640 or fill out our confidential online form to get started.

During your consultation, we’ll go over the claims process, potential roadblocks, and legal options to help you move forward. Wildfires have taken enough from you—don’t let insurance companies take more.

Copyright © 2025. The Shamsi Law Firm, APC. All rights reserved.

The information in this blog post (“post”) is provided for general informational purposes only and may not reflect the current law in your jurisdiction. No information in this post should be construed as legal advice from the individual author or the law firm, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting based on any information included in or accessible through this post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country, or other appropriate licensing jurisdiction.

The Shamsi Law Firm, APC
13209 Saticoy St.
North Hollywood, CA 91605
(818) 764-7640(818) 764-7640
https://www.shamsilaw.com/