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Greg Econn, Executive Vice Chairman of Venbrook Insurance Services and Steadfast LA Insurance ChairCredit: Michelle Edgar<\/p>\nOver a year after wildfires tore through Los Angeles, the question is no longer how fast we can clear debris or issue permits. The real question is far more uncomfortable: Who actually gets to come back?<\/p>\n
Today\u2019s Los Angeles recovery is not being determined by construction timelines or political will, but by insurance, with the question of how homeowners will be insured post-rebuild in high-risk areas. Insurance is quietly deciding which communities survive and which do not.<\/p>\n
Public attention has focused on visible bottlenecks \u2013 debris removal, permitting delays, and rising construction costs, but those are not the true constraints. The real bottleneck is invisible access to coverage. \u201cFrom an insurance perspective, insurance determines whether a community survives,\u201d said Greg Econn, Executive Vice Chairman of Venbrook Insurance Services and Steadfast LA Insurance Chair. \u201cIf the policies don\u2019t respond and people don\u2019t have the wherewithal to rebuild, they leave. And if they leave, the community doesn\u2019t come back.\u201d<\/p>\n
Greg Econn, Executive Vice Chairman of Venbrook Insurance Services and Steadfast LA Insurance ChairCredit: Michelle Edgar<\/p>\n
At its core, insurance is designed to spread risk; many contribute so that a few can recover, but that system is under pressure. \u201cWhat used to be 50-year or 100-year events are happening with far greater regularity,\u201d Econn said. \u201cThe models are being tested in real time.\u201d<\/p>\n
Behind every homeowner\u2019s policy lies a global system where insurers pass risk to reinsurers, and reinsurers pass it to retrocession markets, distributing exposure across international capital. \u201cThe capacity is there,\u201d Econn said. \u201cIt\u2019s not a question of whether capital exists; it\u2019s under what conditions it is willing to be deployed.\u201d Capital has not disappeared, but has become conditional.<\/p>\n
For homeowners, recovery now depends on navigating three imperfect paths: self-insurance, the FAIR Plan, or traditional coverage known as HO3, the gold standard required by lenders. \u201cHO3 is the gold standard,\u201d Econn said. \u201cIt\u2019s as good as you\u2019re going to get, and it\u2019s what lenders require.\u201d<\/p>\n
Access to that level of protection is no longer guaranteed. Without insurance, there is no financing, and without financing, there is no rebuilding. What was once a back-end purchase has become the front door to recovery.<\/p>\n
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Insurance is no longer underwriting homes; it is underwriting communities. Even newly rebuilt, fire-hardened homes are struggling to secure coverage, not because of their design, but because of their surroundings. \u201cThis is a partnership,\u201d Econn said. \u201cIf you\u2019re protecting your asset, you\u2019re protecting the insurer\u2019s asset. Nobody wins in a loss.\u201d<\/p>\n
There is an even more consequential force shaping recovery: time. Data shared among industry and legal experts reveals a stark pattern: approximately 30 percent of homeowners leave immediately after a disaster. Of those who remain, most are willing to wait up to three years to rebuild. After that, communities lose roughly 20 percent of their remaining residents each year; by year six, many neighborhoods are largely gone. The implication is difficult to ignore. Recovery is not just about resources; it is about speed.<\/p>\n
Even when coverage exists, the path forward is not simple. \u201cSmoke damage has been one of the most disruptive issues we\u2019ve seen,\u201d Econn said. \u201cThe definitions are narrow, and that leads to underpayment and litigation.\u201d<\/p>\n
After major disasters, insurers often deploy independent adjusters from across the country, interpreting policies strictly, leading to delays, disputes, and in some cases, denials.<\/p>\n
At the same time, homeowners are asked to reconstruct their lives from memory. \u201cYou\u2019re handed a blank sheet of paper and asked to recreate your entire home,\u201d Econn said.<\/p>\n
At the same time, California is beginning to address one of the most contested points in recovery, smoke damage. Legislation expected to move through the Assembly on April 22, AB 1795, the Smoke Damage Recovery Act, would establish the first uniform, statewide standards for how smoke damage is inspected, tested, and remediated.<\/p>\n
Today, no such standards exist. The result has been a patchwork of insurer practices, delayed claims, partial payments, and, in some cases, outright denials; all of which slow recovery at the moment it matters most.<\/p>\n
AB 1795 aims to change that by requiring consistent remediation protocols, mandating insurer compliance, and ensuring homes are restored to safe, habitable condition. It also introduces timelines, including requiring insurers to inspect properties within 30 days and to release undisputed funds within 15 days once remediation begins.<\/p>\n
The impact extends beyond claims handling. By creating clarity around one of the most disputed areas of wildfire recovery, the legislation has the potential to reduce delays, restore confidence, and accelerate rebuilding timelines, and in a system where time determines whether communities survive, that may be the difference between recovery and permanent loss.<\/p>\n
Environmental realities add another layer of complexity. Post-fire ash can contain hazardous materials, including asbestos, lead, and heavy metals. In some cases, contamination is discovered after initial cleanup, requiring additional testing and excavation that can cost tens of thousands of dollars. Each delay compounds the same outcome with time lost, and residents leaving, communities eroding.<\/p>\n
There are signs of progress. \u201cWe went to London about 30 days after the loss,\u201d Econn said. \u201cWe knew that if we could get a viable product in place, others would follow. The industry operates with a herd mentality,\u201d he said. \u201cOnce one or two carriers step in and it works, others follow.\u201d<\/p>\n
Billions in coverage have begun to return, particularly in builders\u2019 risk, demonstrating that capital can flow back when risk is better understood and managed.<\/p>\n
None of this works without preparation. \u201cIf there\u2019s one takeaway, it\u2019s to document everything before a loss occurs,\u201d Econn said. \u201cPhotograph every room; every drawer; every closet. We try to adjust the loss before it occurs.\u201d<\/p>\n
Preparation is no longer optional; it is part of resilience. What is happening in Los Angeles is not just a rebuild; it is a restructuring in an upcoming election year, with a new insurance commissioner coming in as well, which plays a critical role.<\/p>\n
Rebuilding is no longer just about construction; it is about insurance, time, and the ability of systems to respond under pressure. \u201cInsurance provides the capital between disaster and recovery,\u201d Econn said. \u201cWithout it, the pathway back simply does not exist.\u201d<\/p>\n
As climate-driven disasters intensify, the challenges facing California will not remain isolated, but will spread, and the question facing communities will not just be how to rebuild, but whether they can rebuild at all, because in the new economy of climate risk, insurance is no longer just a safety net, but the gatekeeper.<\/p>\n","protected":false},"excerpt":{"rendered":"Over a year after wildfires tore through Los Angeles, the question is no longer how fast we can…\n","protected":false},"author":2,"featured_media":259898,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[4300,114558,3002,48,52,51,47,50,49,1839,4495,69672,535],"class_list":{"0":"post-259897","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-los-angeles","8":"tag-eaton-fire","9":"tag-greg-econn","10":"tag-insurance","11":"tag-la","12":"tag-la-headlines","13":"tag-la-news","14":"tag-los-angeles","15":"tag-los-angeles-headlines","16":"tag-los-angeles-news","17":"tag-palisades-fire","18":"tag-recovery","19":"tag-steadfast-la","20":"tag-wildfires"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/259897","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=259897"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/259897\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/259898"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=259897"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=259897"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=259897"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}