Climate Disaster: When the Smoke Clears

While the 2023 California wildfire season was relatively calm as compared to 2020 and 2021, the state’s two worst wildfire seasons on record, it still brought devastation to roughly 6,935 acres, ravaging the land and all who call it home. Rackham Ph.D. student Joyce Ho is an economic and environmental sociologist working to document and understand both the traumatic experiences of homeowners and the adapting practices of insurance companies in the aftermath of forest fires in northern California.

“Climate change is changing the landscape of private property insurance, especially in the U.S., and that’s changing people’s lived experiences,” Ho says.

Ho points to research by Indigenous scholars that, while climate change is responsible for many of the natural disasters seen in recent years, including forest fires, California’s infernos also share a history rooted in settler colonial policies developed in the early 1900s that largely ignored centuries-old indigenous land management practices of controlled cultural burns.

Now, with rural areas often overburdened with dead leaves, branches, and forest detritus, the forest is a nest of kindling hungry for a spark. And when the smoke clears and the dust settles, the act of calculating the losses has been called “the trauma after the trauma” by those who’ve experienced these catastrophes first-hand.

Insurance Scarcities and Budgetary Impossibilities

In spring 2023, State Farm and Allstate announced that they are no longer issuing new property and casualty coverage in the state of California, citing soaring costs associated with the wildfires and new construction. For those with existing coverage, rate hikes as high as nearly 40 percent can push a household budget to the brink. According to Ho, this is just one way that fire-related costs are consuming Californian’s earnings.

“California’s history, economics, and politics are such that a lot of people are driven out of the large cities by the high costs into rural areas,” Ho says of the most fire-prone regions of the state.

“These areas have been developed quickly, and now the people who’ve moved there are facing a situation where these places are also becoming unaffordable and unlivable due to the cost of insurance. At least one of my interviewees has plans to move away from the state.”

Emotional Losses Hit Home

For those who’ve lost their homes in forest fires, the impacts are devastating, hitting far more than pocketbooks alone.

“For the people I talked to, it’s an emotional loss, it’s an ecological loss, it’s a communal loss, it’s a social loss,” Ho says.

The sense of loss is something that Ho understands first-hand, as in 2020 her father experienced a house fire. Ho assisted her dad through the insurance process and through his sense of displacement and grief.

“My dad’s insurance company was able to pay for temporary housing for a year,” Ho says.“There were plenty of nearby amenities, a Whole Foods on the first floor of his building, restaurants all around. But my dad talks about how he never set foot in the Whole Foods and never set foot in those restaurants. It just didn’t feel like home to him.

Making the List

The trauma of fire and displacement is amplified for many by insurance companies’ need for an inventory list of all the items lost in the blaze. Everything must be accounted for: every spice on the rack, every shirt in the closet, every appliance, book, and shoe. Details are beneficial, too, and many insurance companies request information on each item’s brand, price, age, and receipt.

“Creating these lists has potentially a more negative impact on people who are going through large-scale disasters. There needs to be some flexibility or some thought about how these policies might be modified in times of disaster,” Ho says.

Through interviews with insurance adjusters, Ho has found many who try to help homeowners in any way they can, including generous timelines for creating the list, creating “item bundles” instead of hyper-specific lists, and helping people remember certain items that they had.

“Insurance adjusters know that if you had a bike, you likely had a helmet, a bell, and a lock,” Ho says. “There are ways that insurance adjusters on the ground are working in order to recognize the overwhelming sense of loss that homeowners are feeling and try to accommodate for that.”

The California Department of Insurance has pushed for insurance companies not to require lists specifically after wildfires, offering the majority of a claims payout without a list. While this is a practice adopted by many insurers in the wake of a large-scale disaster, it is not a policy codified by law. In fact, most insurance companies are opposed to legal codification, citing the need for accurate payouts and a desire to avoid regulation on the state insurance market.

“Climate change and these disasters are happening at a pace and at a scale that the insurance companies have not been able to catch up with yet,” Ho says.

During the summer of 2023, Joyce Ho conducted fieldwork in northern California, visiting multiple sites including the burn scar of the 2021 Caldor Fire (pictured here).

Change from the Ashes

Ho hopes that her research, drawing from both the experiences of homeowners and insurance adjusters, will create space for gentler insurance procedures in the aftermath of disaster.

“There’s room for negotiation, room for a little more flexibility,” Ho says.

In terms of how everyday people across the nation can secure their property in the face of surging natural disasters, Ho is a big proponent of reading the fine print.

“Everyone should know their coverage and understand what’s in their policy: what’s covered, what’s not, what the limits are, and how much they’re covered for,” Ho says.

Through her research, Ho has interviewed many who were underinsured or who hadn’t looked at their policy in years and ended up having to take out a second mortgage or massive loans to cover expenses.

“If you don’t understand the language on your policy, talk to an insurance agent, do some research online. There’s a lot of jargon there, but it’s absolutely worth doing.”