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As flames swept across the hills of Malibu during the Franklin Fire, hundreds of California homeowners found themselves asking the same two questions: “Do I have enough insurance?” and “What happens now?”
For residents in fire-prone areas, these questions have become a grim seasonal ritual. And for an insurance industry already under strain, each new wildfire is another reminder of how fragile the system has become.
In a recent live interview, independent insurance expert Karl Susman offered clarity and calm, breaking down what homeowners need to know when wildfires threaten their property. His message was practical and grounded in experience: safety first, preparation always, and knowledge is your best defense.
Safety Always Comes Before Property
When asked what Malibu residents should do as fires approached, Susman was direct.
“Please don’t go driving around in the fire area,” he warned. “Nothing is more important than protecting ourselves and staying safe. As much as our inclination is to protect our home and our stuff — it’s just stuff.”
Once a wildfire is active, insurers typically freeze all policy activity. That means no new coverage can be added, no limits raised, and no new policies issued until the emergency ends. If you are thinking about increasing coverage during a live fire, the window has already closed.
Preparation must happen long before fire season:
- Store a digital copy of your policy in the cloud
- Keep emergency contact numbers saved on your phone
- Maintain a go-bag with documents, IDs, medications, chargers, and backup files
Preparation turns panic into a plan, and in evacuation situations, that can make all the difference.
Evacuation Expenses and Loss of Use Coverage
One of the most overlooked protections in homeowners insurance is “Loss of Use,” also called Additional Living Expenses (ALE). This coverage can reimburse you for temporary housing, meals, and certain transportation costs if you are forced to evacuate.
Mandatory evacuation orders frequently trigger these benefits, even if your home is not damaged.
“If there’s an evacuation, check with your insurance company,” Susman advised. “Some policies will provide coverage if you have to leave.”
The key requirement is documentation. From the moment you evacuate, keep all hotel, meal, and transportation receipts. Without proof, reimbursement becomes far more difficult.
Santa Ana Winds and Why Fire Risk Is Everywhere
The Franklin Fire, like many Southern California wildfires, was driven by Santa Ana winds. These seasonal wind systems can turn a small spark into a fast-moving regional disaster within hours.
“Anytime the Santa Anas kick up, it’s fair game anywhere,” Susman explained. “If you live in an above-average fire risk area, always have your go bag ready.”
Although Malibu was in the spotlight, he emphasized that many Southern California communities face similar exposure — from coastal canyons to inland foothills and desert edges. Wildfire risk is no longer confined to remote mountain zones.
How the Franklin Fire Affects the Insurance Market
Homeowners naturally worry whether each new fire will further destabilize California’s insurance market. Susman’s answer was measured.
“This is the type of fire that’s been expected,” he said. “These areas are known to burn every five to seven years, and most of them are already insured through the California FAIR Plan.”
The FAIR Plan, California’s insurer of last resort, has become the primary insurer in many high-risk wildfire regions. It provides basic fire coverage but does not include:
- Theft
- Water damage
- Personal liability
- Additional living expenses beyond limited terms
For full protection, most FAIR Plan policies must be paired with a Difference in Conditions (DIC) policy from a private carrier. For Malibu and similar regions, FAIR plus DIC is now the standard path to comprehensive coverage.
Why the Franklin Fire Will Not Trigger Market Collapse
Despite public anxiety, Susman does not believe the Franklin Fire will cause a sudden collapse or new mass withdrawal of insurers.
“This won’t have a major impact on what the industry is already doing,” he explained. “Insurers already know these areas burn regularly — they’ve priced that risk in.”
California’s deeper insurance crisis is structural, not event-driven. Proposition 103, the state’s 1988 insurance law, requires rate approval based on historical data. That system struggles to reflect today’s reality of climate-driven wildfire patterns and skyrocketing reinsurance costs.
Each fire adds pressure, but it is the regulatory framework — not individual disasters — that keeps insurers cautious or out of the market.
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Why Coverage Is Harder to Find in Fire Zones
Many insurers, including State Farm, Allstate, and Farmers, have paused new policies or non-renewed existing ones in high-risk ZIP codes. This is not personal — it is driven by risk concentration.
When too many policies are clustered in one fire-prone region, insurers hit internal exposure limits. If they continue writing policies without the ability to properly price risk, they jeopardize their own solvency.
The FAIR Plan fills this gap, but it was never designed to function as a long-term primary insurer for hundreds of thousands of homes. Meaningful regulatory modernization remains the only viable path to restoring a healthy private market.
Practical Steps Every Homeowner Should Take
Susman outlined several actions every California homeowner should take now, not after the next fire breaks out:
- Review your coverage annually to ensure rebuilding limits reflect current construction costs
- Combine FAIR Plan and DIC policies if private coverage is unavailable
- Document your belongings with photos or videos stored in the cloud
- Maintain defensible space and upgrade to fire-resistant materials when possible
- Understand evacuation and loss-of-use benefits before they are needed
Inflation and new building codes mean many homes cost 30–50% more to rebuild than they did just a few years ago. Underinsurance remains one of the most common and most dangerous problems after major fires.
The Emotional Reality for Homeowners in Fire Zones
The Franklin Fire highlights not just a financial crisis, but a human one. Homeowners live with constant anxiety, rising premiums, and shrinking options in what was once a competitive insurance landscape.
Susman’s advice remains consistent:
“Take the time to review your policy and talk to your broker. Make sure you have what you need before you need it.”
While wildfire risk may be unavoidable, financial devastation does not have to be.
What the Franklin Fire Teaches About the Future
The Franklin Fire reinforces a harsh truth: wildfire is no longer an anomaly in California. It is a permanent part of the state’s risk landscape.
Insurance alone cannot stop fires, but it can determine whether families recover or face permanent financial loss. Policymakers continue to work toward reforms that would allow better catastrophe modeling and reinsurance cost recovery. Until then, homeowners will remain reliant on the FAIR Plan and layered coverage structures.
Final Thoughts
The Franklin Fire may not be California’s largest blaze, but it is a powerful reminder of the new reality homeowners face. Wildfire is now a constant threat, not a rare event.
As Karl Susman reminded viewers, preparation is not optional:
“Be ready. Have your go bag, your digital records, and your policy information in one place. Because when the winds shift, it’s already too late to prepare.”
For California homeowners, that isn’t alarmism — it is the new baseline for survival and recovery.
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