Nevada homeowners are being lumped in with California when it comes to wildfire risk, leading to more nonrenewals, cancellations and application denials of insurance policies in some unexpected parts of the state.
Clark County ranked second in the state for homeowners insurance policy cancellations and nonrenewals due to wildfire risk, according to a presentation made by the Nevada Division of Insurance on June 17 to Joint Interim Standing Committee on Commerce and Labor of the state Legislature.
In 2024, the latest data available, 357 homeowners lost coverage out of 772,861 policyholders, Division Commissioner Ned Gaines said. The majority were nonrenewals of policies.
“We’re still talking really small numbers,” Gaines said in an interview with the Las Vegas Review-Journal on cancellations and nonrenewals. “Now, of course, (for) anybody that is affected by it, it’s not a small occurrence, and we’re fully aware of that.”
The county also ranked second for homeowners insurance applications declined because of wildfire risk, according to the Division of Insurance. Insurers denied 2,770 applications out of 650,227, or about 0.4 percent of applicants. But it represented a 2,015 percent increase over three years.
Clark County cancellations, denials
Gaines said the increase could be because of recent wildfires in California.
“What we are finding in some of these ZIP codes is that they’re rating them as very high wildfire risk, which doesn’t seem to match the conditions on the ground,” said Gaines during the meeting. “It appears that with the recent wildfires that have taken place in California, we are getting lumped in with them.”
Gaines said the agency typically sees issues in the Lake Tahoe area with homeowners having policies not renewed, canceled or denied because of wildfire risk.
However, during the meeting with lawmakers, Gaines highlighted four Clark County ZIP codes that recorded notable increases in 2024: 89138 near Summerlin North, 89011 and 89012 in Henderson and 89166 in the Skye Canyon area in the northwest valley.
The ZIP code 89138 saw 506 applications declined in 2024, up from 25 in 2022 and 57 in 2023.
Northwest Las Vegas, near Skye Canyon, recorded an 8,800 percent increase over three years, rising from one denial in 2022 and 2023 to 89 in 2024.
Henderson ZIP codes 89012 and 89011 saw increases of 8,200 percent and 7,900 percent, respectively, during the three-year period. ZIP code 89012 rose from four denials in 2022 to 332 in 2024, while ZIP code 89011 increased from two in 2022 to 160 in 2024.
ZIP code 89129 also saw a sharp increase, rising 5,100 percent from one denial in 2022 to 52 two years later.
“The biggest concern we have right now is that we’re seeing some areas where the underwriting has been tightened, but when we look at those areas, when we speak with the fire chiefs, fire marshal, we’re not seeing that that risk is really elevated there, because it is a different type of vegetation,” said Gaines during the meeting.
Members of the committee expressed concern over cancellation in urban areas.
State Sen. John C. Steinbeck, R-Las Vegas, who previously served as chief of the Clark County Fire Department, called it “very concerning” to see urban area homeowners having their insurance declined, cancelled or not renewed.
“We don’t lose homes here in the urban Las Vegas area due to wildfires,” said Steinbeck during the meeting. “What we do lose a home to sometimes is like a firework hits a tree… But we don’t have house‑to‑house fires here in the urban area, and it’s very concerning that these areas are being subject to these types of increases.”
Current law states policy providers are allowed to cancel a policy within the first 90 days of issuance.
Current law states homeowners insurance providers have 90 days to do a inspection on the home and potentially cancel the policy. Gaines said many providers are choosing to wait to inspect properties after the policy holder has already paid one or two monthon their policy.
Assemblywoman Elaine Marzola, D-Clark County, proposed shortening the inspection period from 90 to 30 days through legislation to encourage insurance companies to do the inspections on the “front end” of the issuing the policy, to which Gaines agreed.
“What I don’t want is for Nevadans to keep paying their premium for 60 days, and then the 90 days hit, they do the inspection, and bam, they’re canceled,” said Marzola.
Prevention and next steps
Despite the increase and concern from the division, Gaines said the market for homeowners insurance is still “healthy” for the population, with just under 100 insurers that are writing homeowners policies in the state.
The biggest effect this will have on consumers is having to “shop around” a little bit more, specifically those in wooded areas like Mount Charleston, Gaines told the Review-Journal.
“In the past, shopping around meant that you might have to get quotes from, you know, up to like five or six carriers,” he said. “Now you might have to go to about 10.”
According to Gaines, sometimes policy writers will cancel, deny or not renew policies when there are too many homes insured in the same neighborhood.
“The more homes they have in any geographic area, the greater their overall loss (for the company),” said Gaines, who emphasized that homeowners insurance is not only individual, but community-wide.
Gaines recommended homeowners do mitigation or community-wide mitigation to decrease the risk of their insurance policy being denied, cancelled or non-renewed due to wildfire risk.
Contact Emerson Drewes at edrewes@reviewjournal.com. Follow @EmersonDrewes on X.
