TELLER COUNTY — Getting to the home of John and Linda Towner in mountainous Teller County isn’t necessarily easy. And that’s the way they like it.
Turning off the highway in Divide, Colorado, one must drive several miles before exiting onto a nondescript dirt road, where the drive continues for several miles more. It’s a beautiful area with plenty of wildlife and a distinct lack of development.
The Towners' house is remote. It’s forested. And it’s where they’ve lived for 28 years as homeowners. They had it built, and it’s where they hoped to spend the rest of their days.
But it’s also become uninsurable–at least for the time being. They received a notice of non-renewal from their insurance carrier last month, much to their chagrin.
“We're scared to death. We're not sleeping at night,” said Linda Towner. “It's been about a month since we found out that they aren't going to renew us, and that's been foremost in our mind.”
“This is everything we've got, and we don't want to lose it. I don't know what we would do if we did lose it. We have no insurance.”
Living in Teller County, they’re accustomed to the extreme fire danger the state of Colorado and their area possess. The summer fire risk is the worst of it, but fire season is viewed as more of a year-round event these days.
The Turkey Track Fire burned over 120 acres a couple of weeks ago on the southern edge of nearby Douglas County, not too far from the Towners. Though fire crews from local, state, and federal agencies got it under control quickly, it served as a reminder of what’s at stake.
In 28 years, the Towners said they’ve never filed a claim for their insurance. In fact, at the request of their insurer, Allstate, they’ve poured thousands of dollars into wildfire mitigation and home hardening efforts in recent years.
They cleared debris, cut limbs, installed stucco, and put in a metal roof. They’re preparing to do a second round of mitigation work that could cost upwards of ten thousand dollars.
“Nothing's going to work because they don't want to hear what we're doing. They just want to say no,” John said.
“Now we're scrambling, trying to find somebody that will insure us,” said Linda. “We're not having a lot of luck.”
Before being dropped, their insurance premium was becoming untenable financially. According to the Towners, they started at six or seven hundred dollars when their home was built, but that increased to $5700 last year.
Had they maintained their insurance, the price was admittedly getting out of hand. They’re on fixed income with Social Security, retirement, and savings. But they said their savings are drying out as they’ve spent so much implementing the mitigation and hardening work.
“We're eating into our savings now, which is also unsettling,” said Linda. “If we, on down the road, if we needed other health care or something like that, we could be up a creek. Then it's a scary, scary situation.”
They’re shopping around and hopeful they might get on another insurance plan. It wouldn’t be as good of coverage as they had, but they just want something. Anything. They’re also looking into the Colorado FAIR Plan, which launched on April 10.
The FAIR Plan is the insurer of the last resort and is not intended to be affordable or provide generous coverage, but for homeowners like the Towners, it could be the only option.
“According to recent information about your residence, it should now be classified in our Town Class 10 category, meaning you either have no primary responding fire department or the existing fire department service is inadequate,” said their Notice of non-renewal.
THE INSURER OF LAST RESORT
The FAIR Plan, which stands for Fair Access to Insurance Requirements, was approved by the state legislature in 2023 and finally launched April 10. It took two years to essentially build an insurer from the ground up. And it’s the first FAIR Plan to launch in the US in 40 years.
It was created to deal with Colorado’s worsening insurance crisis as wildfires and hailstorms become more damaging.
To qualify, homeowners must be denied coverage three times by insurance carriers before they can speak with any licensed broker and begin the application process for FAIR Plan coverage.
As of April 25, 15 days after launch, the FAIR Plan said they’ve received almost 100 price indications. About 70% of those turned into applications and official quotes. Kelly Campbell, executive director of the Colorado FAIR Plan, said the launch is going as expected so far.
Chris Mosley, an insurance recovery lawyer with the Reed Smith law firm, said the FAIR Plan is a great idea for Colorado and will allow people to live virtually anywhere in the state, but cautioned homeowners from viewing it as an end-all solution.
“The FAIR Plan is not intended to be a premium reduction vehicle,” Mosley said. “If a homeowner receives an offer from an insurance company with premiums that are very, very high, that homeowner would not qualify for the FAIR Plan. So it really is one of the things that I think it's important for homeowners to understand is if you can get insurance, even though it's expensive, Colorado is going to require you to get that insurance if you want insurance at all.”
Colorado hopes to avoid the insurance crisis bubbling in other states like California and Florida. In Florida, the insurer of last resort is the largest in the state as the private market has been driven out.
The FAIR Plan will cover individual homes up to $750,000 and commercial exposures are limited to $5 million. The commercial option is expected to launch in June.
“If the cost to repair or replace a home that's damaged or destroyed by fire exceeds $750,000, then the homeowner is going to be responsible for any amount over the $750,000,” Mosley said.
He also noted the coverage options are far less intensive under the FAIR Plan as it only provides the most basic of coverage when it comes to fires. If homeowners want to add additional hail, wind, or vandalism coverage, the premiums go even higher.
For example, according to premium rate examples provided by the Colorado FAIR Plan, a 2,288 square foot home in Evergreen, Colo. With a market value of $850,000 the charge would be $4,361.69 for fire coverage and an additional $1,151.94 for extended coverage (like hail and wind). And due to the cap, the home’s value would only be covered up to $750,000.
“Every homeowner has unique risks, and make sure that, as a homeowner, make sure that you address those risks with [a] broker, so that at least you can understand ‘Yes, that's covered’ or ‘No, it's not covered,’” Mosley said. “Even the answer of ‘No, it's not covered’ may be upsetting and unsatisfactory, but at least you know it. And if you know it, you can prepare in some way for it, whether financially, emotionally, whatever the case may be.”
The Colorado FAIR Plan has launched online tools to help homeowners understand the application process andhow to find a licensed broker to start them on the path.
“I'LL BE FRANK AND BLUNT. IT'S A CRISIS”: SOME THINK FAIR PLAN ISN’T ENOUGH
Teller County Commissioner Dan Williams doesn’t mince words when he discusses the insurance issue his constituents are facing.
“It's endemic now, it's a crisis,” Williams said. “These aren't folks that are just having to pay two or three times as much. They’re actually being dropped with no alternative.”
Williams, who lives up the road from the Towners, doesn’t see John and Linda as outliers. He said their problems are indicative of a growing issue not only in his community, but one that’s growing statewide as well.
“Nothing seems to be seasonal anymore. Climate change is real, right?” said Williams, a Republican. “Whether you want to call it climate change or extend a drought, it shouldn't be political. We should look at what's happening.”
Last year, a high country tornado tore through his property, a rare occurrence. He posited that those extreme weather events, including wildfires and hail storms, are likely to get worse.
He also worries about how many constituents are on fixed income who may soon have to make difficult choices in the face of rising insurance costs or who must shell out for the FAIR Plan premiums.
“It's probably five to 10% of the people that live up here on fixed incomes have no insurance. It's a risk. It's a gamble,” Williams said. “When the fire comes through, if it takes their home, it's a good equation of becoming homeless. And so it is a serious issue.”
Williams and the Towners said it could cause an economic downturn for mountain communities as well. If too many people are driven out of their homes due to the insurance crisis, they’ll have to move somewhere outside of the area, which could be detrimental to the local economy.
The commissioner said the FAIR Plan should have been started years ago and views it as a good first step, but he doesn’t think it will be enough to soften the coming troubles around the state.
“Unfortunately, I think we'll have some real feedback and after action reviews by the end of the fire season, because people start to apply,” he said. “I believe that it's a good first step, but it's not far enough, and I believe that it'll become overwhelmed very quickly if we have the kind of fire season this year that we had last year. And when I say ‘we,’ not just Teller County, but Colorado writ large.”
For now, homeowners like the Towners can only hope they find some alternative insurance coverage. If not, they’ll apply for the FAIR Plan.
But in a worst case scenario, if they decide to sell their home, the realization has already set in that an option like that may not be too feasible either.
“Who would buy our home if there's no fire insurance? Even if whoever bought it could afford it, they may not be able to get it, because they just wouldn't be covered,” said John Towner.
“Who would buy our home then? So we're stuck here with a house that we can't sell. That's a possibility.”
Email Senior Reporter Brett Forrest at brett.forrest@koaa.com. Follow @brettforrestTVon X and Brett Forrest News on Facebook.
Brett can also communicate via encrypted apps like Signal. Due to the sensitive nature of ongoing reporting from federal actions, he is willing to take steps to protect identities.
Pueblo community honors 13-year-old Joeylin McDonald with lantern ceremony
Family and friends gathered at the Riverwalk in Pueblo to celebrate the life of 13-year-old Joeylin McDonald, who passed away last week in a tragic accident at a youth program.
