You would think that if anyone understood the importance of maintaining a safe and sound homeowners insurance policy, it would be Tricia Flaherty.
And you would be correct.
Flaherty is the administrative assistant for the Sonoita-Elgin Fire District. Her work life is a daily reminder of the potential threat of wildfire and weather-related consequences of living in a rural community situated among a sea of grassland and tree-studded hillsides.
Yet none of this prevented Flaherty from having to endure three angst-filled weeks around the Christmas-New Year holiday after the insurance on her multi-generational home in Casa Blanca Canyon was canceled.
“One of my sons, he lit a candle, and I said ‘Aaahhhh, put that candle out,’” Flaherty recalled. “You are on edge. From the 20th [of December] to the 10th [of January], I was thinking, my god, if there’s a wildland fire and it takes the home, we have nothing.”
Flaherty’s situation is becoming more and more common, as homeowners insurance becomes increasingly unavailable or priced beyond the reach of rural residents. It’s a problem that only figures to grow worse in the aftermath of January’s devastating wildfires in the Los Angeles area.
Mike Wright, owner of Landmark Insurance in Sonoita, says his affiliated agencies are no longer offering coverage in areas such as Elgin, Rain Valley and Canelo.
“I have no companies that can offer coverage to clients,” Wright said. “Pricing and availability are at a crisis. Everything rural is considered high risk.
“Three to five miles from the fire station you’re sitting pretty good. People in Rain Valley, Vaughn Loop area, Elgin area are at risk. The ones I’ve had on the books, they are renewing, so I’m happy for them. When they tell me their rates are twice what they were, I tell them, ‘Well, you need to thank them for offering a renewal.’”
There are numerous issues at play—the growing preponderance of climate-fueled disasters a significant one—and this is well beyond a local problem. Many major insurers have abandoned the California marketplace. One overriding factor here is the rural nature of the community.
Homes in Patagonia proper or within five miles of the Sonoita-Elgin fire station are generally insurable—although many of those rates have risen. The farther away one goes, however, the predicament grows.
Nora Stewart inherited a cabin of less than 1,000 square feet in 2022 on five acres in Westgate—a rural “subdivision” to the east of Canelo and some 22 crooked miles from the Sonoita-Elgin fire station, at the very southeastern edge of the fire district’s coverage area. She was unable to renew the previous owner’s insurance policy but did find an alternate source. Her rates have risen about 30 percent in two years, and she expects that they will continue to go up every year. She wonders whether it’s wise to continue with anything beyond basic liability coverage.
“I feel like I’m throwing good money after bad,” she said. “If there’s a wildfire, I figure I’m on my own. I’m far enough away from the fire station, they wouldn’t get here in time anyway. I’m more worried about my wells running dry. If my wells run dry, my house is worthless.”
Stewart doesn’t have her head in the sand. Prior to moving here, she lived and worked in Sierra Madre, CA, directly adjacent to the unincorporated town of Altadena that’s been decimated by the Eaton Fire. She’s keenly aware of the risks and has followed the recommended playbook in proactively protecting her property.
“I do what I can for fire mitigation,” she said. “I had the Sonoita fire guy come out and give me an assessment. It’s a wonderful service. He weed whacked for me for $35 an hour, cleared a wider swath along the driveway, told me what I need to do. He said the way I have it mowed down, he thinks I could shelter in place.”
Sonoita-Elgin Fire District chief Mark Meredith encourages residents to follow Stewart’s lead, no matter where they live.
“We are happy to come out and talk to residents, walk around their property, identify opportunities to lessen fire danger,” he said. “If somebody needs to have a mitigation done, then we have a small list of folks nearby that do the work, and we will refer the homeowner directly.”
While assessment and mitigation are highly recommended as safeguards, they are no guarantee of insurability.
Insurance companies calculate premiums and availability based on an area’s ISO (Insurance Service Office) rating, which range from 1 (best) to 10 (worst). Sonoita-Elgin’s rating is 8B, and that applies only within five miles of the fire station. (For those wondering: Patagonia has an ISO rating of 6, due to its municipal water supply.)
“The single predominant variable in determining what your rating is—it doesn’t matter how good your [local fire department’s] equipment is, it doesn’t matter how well-trained your firefighters are—is water supply. Period. End of story,” Meredith said.
With no municipal water supply and fire hydrants an impracticality, it all comes down to how much water the SEFD can bring to a fire.
“I’m constantly looking at bringing better service to the community, whether it’s the equipment we have, the training of our firefighters, we’re working on all of those things, but the one thing we can’t do anything about independently is change the water supply,” Meredith said. “One thing that can help us is many of our residents have water storage, anywhere from a few hundred gallons to thousands of gallons, typically in an above-ground tank. And if they provide a connection for us to tap into, that helps because it means we’ve got ready water when we get there.”
Like Stewart, Meredith can personally relate to the horrors being experienced in southern California. He grew up in Pasadena, his family still lives there, and while the family home didn’t burn, his mother and brother were forced to evacuate.
“I have friends and classmates back home who lost their home, lost quote/unquote everything,” he said. “The impact of this is going to push into our community.
“I’m no insurance expert by any means, but I think nationwide it’s going to have a massive impact on accessibility to policies, cost of policies, duration. The challenge is that if you have a mortgage, you’re going to have to have homeowners insurance.”
Which brings the issue back to what homeowners can do when their insurer pulls out of the market.
Unlike 33 other states across the nation—including California—there is no government-backed plan in Arizona to offer property insurance to homeowners unable to find insurance in the traditional marketplace. (These plans are usually known as “FAIR,” short for Fair Access to Insurance Requirements).
Last December, the Arizona Department of Insurance and Financial Institutions established a Resilience and Mitigation Council. Its purpose, according to the website, is “to investigate the availability and affordability of homeowners insurance in forested areas and wildland-urban interface areas of Arizona, the impact that natural disasters have on the availability and affordability of homeowners insurance in these areas and strategies that local communities in these areas may adopt to mitigate the risk of property loss due to natural disasters.” It has thus far met twice, and is tasked with submitting a report to the governor and DIFI by December 1.
Wright says he tries to refer clients to other agencies he’s heard are still operating in the area, in particular American Family and American Farm Bureau.
Gordon Purvis lives in Sonoita and operates the Gordon Purvis Agency in Tucson. He is still finding companies willing to work with his clients—conditionally.
“I basically go to every home that I insure, I take pictures, I write a cover letter,” Purvis said. “That’s what separates me from a 1-800 number.
“I’m the bad guy. I go out, point out all the problems—you’ve got to get rid of these trees, clean this up, whatever needs to be done—and folks appreciate it. You need to show a buffer. If you can do that, I can get you insurance.”
One caution: Don’t expect the rates to be what they used to be.
Flaherty said three years ago she was paying $2,600 for her policy. Two years later it was $3,500. Then she received a 30-day termination notice just prior to last Thanksgiving. She was fortunate to be able to use downtime at work to search for coverage, but despite all her efforts, she couldn’t find a replacement within 30 days. And once her policy had lapsed, it meant a “ding” on her record—translating into a penalty on her next premium.
“We had policies come back as much a $35,000,” she said. “It was crazy. I called PNC Bank, who held my mortgage. They give you a 90-day period, after that they’re basically going to force you into a policy at any rate: if you don’t find coverage, we’ll find it for you.”
Flaherty eventually located a policy through the Foremost Insurance Group. Her premium—$2,600 three years ago—is now $5,000, with no guarantee it will stay at that level.
“I’m getting another job, working at a winery on Saturdays, with the intent of putting that income away for tax increases and insurance increases,” she said.
“What else can you do? Your home is your community. Our home is not just people, it’s your cats and dogs, your wildlife. To lose that is to lose a lot more than just a place to put your head down at night.”
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