Colorado House postpones insurance reform bill that would strengthen ... - The Denver Channel

DENVER - The House postponed consideration of an insurance reform bill that would strengthen insurance coverage for wildfire victims on Tuesday.

The bill, which proposes implementation of the Homeowner's Insurance Reform Act, would hold insurance companies more accountable to customers in devastating events such as wildfires. After last summer's devastating wildfires, many victims failed to receive adequate coverage.

According to the bill, insurance companies would be required to offer living expense coverage, additional replacement cost coverage and coverage for 25 percent of a home's contents -- even without an itemized inventory.

The bill's proposal followed three executive orders issued last month by Gov. John Hickenlooper, who created a task force to strengthen insurance coverage for residents living in wildfire-prone areas. The task force explored these issues, as well as wildfire prevention measures.

The bill would help families who are having difficulty rebuilding after wildfires destroyed their homes and possessions.

Kacy Thompson's home west of Estes Park burned down during the Woodland Heights wildfire.

"All we had was the foundation," Thompson told 7NEWS.

Thompson says that Auto-Owners Insurance out of Broomfield has made rebuilding her home very difficult.

Her house will cost $190,000 to rebuild, but Auto-Owners Insurance will only pay $91,000 cash value in advance, despite the fact that she paid a premium for what's called "guaranteed replacement" in the event of a disaster like the wildfire.

"It should be basically the same kind of a house -- the same quality of, for example, windows and doors," says Thompson.

A spokesperson with the Rocky Mountain Insurance Information Association says it is fairly common for insurance companies to pay incrementally as houses are rebuilt, but Auto-Owners Insurance has not told Thompson whether it will pay more at a later date.

Thompson says six homes are being rebuilt around her property, but she cannot proceed because she does not know whether she will be covered.

"Does that mean I need to go get a loan?" Thompson asks. "Maybe, I don't know."

The insurance company had not returned calls from 7NEWS regarding the matter.

Revisions to insurance coverage laws are intended to aid homeowners like Thompson in the future.

The House insurance bill was scheduled for consideration Tuesday but was postponed to an unspecified date.

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