Smoke and Partial-Loss Wildfire Insurance Claims: Coverage, Exclusions, New California Smoke Damage Recovery Act

This CLE webinar will offer practical guidance for navigating and resolving insurance disputes arising from damage to property that survived a wildfire but remains uninhabitable or unusable for its business purposes. The panel will discuss key cases for developing strategies and how the California Smoke Damage Recovery Act will impact these claims in California and may indirectly influence practice in other jurisdictions.

Residential or commercial properties that are still standing in whole or in part after a wildfire are usually far from damage-free. Wind can send the byproducts of burning, including cyanide, lithium, asbestos, and lead, into every crevice of a structure and the property in it. The parties frequently reach an impasse over whether a structure can be cleaned and restored or whether it needs to be demolished and replaced. Counsel need to understand the damage, how complex these wildfire claims are, what causes these impasses, and strategies and practical tools to help break through.

The problem is exacerbated for many reasons. No two claims are exactly alike, and counsel in each dispute usually have to forge their own path forward. A team of experts is needed to understand and document the damage. Some commentators suggest that few insurance adjusters have experience with smoke or extreme heat claims, and many of those who do are retiring. There are no industry or statutory standards for measuring wildfire smoke damage or for determining whether the damage can be or has been corrected, or to what level, much less when a smoke-damaged structure should be considered safe. California enacted the first state law addressing these concerns, the Smoke Damage Recovery Act, but it does not take effect until Jan. 1, 2027, no regulations have been promulgated to implement it, and it will not apply in other states.

Listen as our panel of experienced attorneys offers insights and practical tools for representing clients in wildfire damage claims where the structure has survived and damages arise from wind and smoke.