Canada fire victims feel insurance squeeze amid clean up
By Eric M. Johnson and Nia Williams
CALGARY, Alberta (Reuters) - Two days after the Fort McMurray wildfire turned Bruce Thompson's mobile home into a pile of ash and rubble, he called his insurer to report the damage, despondent as he discussed a life's worth of possessions gone in seconds.
The broker made the situation worse. Insurance would only pay him roughly C$60,000 ($46,959) for his possessions, about a third of the appraised value. As if to console him, the broker said there were "numerous people" like him - all under-insured.
Thompson's mobile home is among more than 2,400 properties destroyed or damaged by flames, smoke, ash, mold or chemicals in Fort McMurray area in May. With industry insiders estimating losses at between C$3 billion-C$5 billion, the fire that raged over this part of western Canada could be the nation's costliest natural disaster ever for insurers.
Although evacuees only started returning to the city last week, the insurance claims process is already deepening a sense of misery for many homeowners and businesspeople starting to rebuild their lives. This comes on top of the financial hardship that many have suffered in this oil-producing region as prices have remained in a slump.
"It's wrong, it's just terribly wrong," said Thompson, a 57-year-old heavy equipment operator. "They are trying to cut me a check and I am not taking it, I am getting legal advice."
Many residents cited insurance representatives who shocked them with lower-than-expected property appraisals, or long wait times for damage inspections by company claims adjusters.
TW Insurance Brokers Inc, who sold Thompson his Aviva Canada insurance policy, would not discuss particular claims, but said that a property loss is determined by the type of policy the homeowner has purchased and a policy can provide replacement coverage or cash at the time of the loss, with depreciation factored in.
Aviva Canada declined to discuss the situation but said it was "very much focused on our customers affected by the fires and being there for them when they need us most." Continued...