Typically, insurance is what you turn to to help cover costs after some sort of disaster strikes—say, for example, the catastrophic wildfires that swept through Northern California last month. But for some homeowners, their high-end insurance plans are offering something more than just a financial benefit. Instead, they’re offering a private forms of what is ordinarily a public utility: fire fighters.
As the Wall Street Journal reported this weekend, tens of thousands of people are currently enrolled in insurance programs which offer private firefighting crews. Some of these people used them during the California fires.
Per the Journal, these for-hire teams are deployed out of insurer-run command centers, and work in coordination with actual public fire crews:
The private crews seek to clear combustible items from a property: wood piles, outdoor furniture including cushions, weeds, straw floor mats and leaves in gutters. They may set up sprinklers with water available at the location, or with water they bring to the site, along with sprinkler lines and a generator to operate them.
Insurers sometimes spray a property’s perimeter with fire retardants, such as foams or gels. The may even spray the home itself, though they typically don’t take this step until a fire is closing in.
For the privilege of having their own private team of fire fighters working to save their property, policy holders can pay anywhere from “thousands of dollars in annual premiums with these firms to more than $100,000" depending on the type and number of properties being covered. And, as the Journal notes: “the services mostly have been available at insurers of the well-to-do.”
In other words: While thousands of ordinary Californians came home to find their homes reduced to ash and cinder last month, the states’ more affluent residents could rest easy knowing their properties were being protected by a private team.
Private fire departments are not something new. In 2013, an Arizona couple was billed nearly $20,000 from a private department after their mobile home burned down. And in 1996, the town of Rye Brooke, NY, became the first municipality to retain the services of a private firefighting company, rather than a public one. But the bundling of private fire services with insurance policies seems to be a relatively new phenomenon. What’s more, it seems to be one that’s increasingly being offered to rich people only.
For example, Chubb Corp, one such private firefighting provider founded in 2008, began by only offering its services to homes with at least a $1 million replacement value.
While it’s hard to blame homeowners for being willing to pay extra in order to provide an added layer of security to their property, the fact remains that private fire services are another example of the opportunities available solely to those with the means to pay for them.
“Do we like the idea of a two-tier system for wealthy individuals and people with less means? No,” insurance expert Amy Bach told the Journal.
“But do we want to see their approaches work?” Bach, who serves as executive director of United Policyholders, a national insurance-focused consumer nonprofit based in California, continued. “Yes.”
Of course, paying to boost the service and capacity of local fire departments—the selfless public servants who actually work to fight fires for a living—is another option, too.