If you’ve received a settlement offer for wildfire damages that feels too low, your primary options are to reject the offer and negotiate for a higher amount, or to file a lawsuit against the corporation responsible for the fire to recover the full value of your losses. The initial offer you received is almost never the final offer; it is a starting point in a business negotiation.
Corporations whose negligence causes these fires, like PG&E, and their insurance companies have a financial interest in resolving claims for the lowest possible amount. They may use digital tools that undervalue your property, overlook significant losses like emotional distress or future expenses, and count on the financial pressure you’re under to compel you to accept an inadequate sum.
However, a low offer does not mean your claim is weak. By systematically documenting your total losses and engaging in a formal legal process, you hold the negligent company accountable for the full scope of the damage they caused—compensation that goes far beyond a standard insurance payout.
If you have a question about a settlement offer you’ve received after a wildfire, call us at (800) WILDFIRE.
Key Takeaways for Low Wildfire Settlement Offers
- The first offer is a starting point for negotiation, not a final valuation. Corporations and their insurers have a financial incentive to minimize payouts, so their initial offer is a business tactic based on formulas that undervalue your total losses.
- Full compensation requires a formal legal claim, not the company's online portal. A legal claim allows you to demand payment for all damages (including emotional distress and future costs) that are typically ignored in initial offers and are not recoverable through an insurer.
- Strict deadlines apply, so you must act promptly to protect your rights. California's statute of limitations limits the time you have to file a lawsuit, and this clock does not stop while you are dealing with an insurance company or a corporate claims portal.
Why Is the First Settlement Offer Usually Low?
It’s a Business Calculation, Not a Personal Assessment
The company responsible for the fire, and its insurers, are for-profit businesses. Their objective is to close your claim by paying out as little as is required to resolve their legal liability. The first offer is based on their initial evaluation, which frequently uses formulas and software designed to minimize claim values. Think of it as their opening bid in a negotiation, not a final, fair assessment of what you've lost.
They Don't Account for Your Total Losses
As already mentioned, initial offers typically focus on the most obvious, easily calculated damages, like the estimated market value of your home’s structure. They frequently fail to include less tangible but equally real damages that rewrite every aspect of life after a fire.
These overlooked damages include:
- Personal Property: The cost to replace everything inside your home, from furniture and clothing to family heirlooms and photographs.
- Emotional Distress: The psychological toll of losing your home, your belongings, and your fundamental sense of security.
- Lost Income: Time you were forced to take away from work to manage displacement, find temporary housing, and deal with the endless logistics.
- Future Costs: The potential for long-term health issues from smoke inhalation or the increased cost of rebuilding your home to meet new, stricter building codes.
They Know You Are Under Pressure
The claims process is long, tedious, and filled with paperwork. Companies understand that you are displaced, financially strained, and emotionally exhausted. A quick, low offer seems tempting when your savings are dwindling and bills are piling up. This approach relies on the hope that you will accept a smaller, immediate sum rather than pursue a longer process for the full amount you are owed.
You Have a Choice to Make: The Company's Path vs. The Path to Full Recovery
After a disaster, the at-fault corporation will present what seems like a straightforward path to getting compensation. This path is designed for their benefit. The alternative path is the one that leads to holding them fully accountable.
Path 1: The Online Portal Trap
Corporations like PG&E create online portals and compensation funds for victims to submit claims directly. You should never use them. These systems appear helpful, but they waste valuable time and complicate your case.
These portals are designed to streamline the process for the company, not for you. They limit the types of evidence you submit and steer you toward a predetermined, inadequate settlement amount. By using their system, you are playing by their rules. This damages your ability to file a proper legal claim later and wastes precious time. The deadlines to file a formal lawsuit, known as the statute of limitations, are strict and do not pause while you wait for a company's portal to give you a disappointing result.
Path 2: Holding Corporations Accountable Through a Formal Legal Claim
This is the approach our firm takes. We do not simply help you fill out insurance forms or use a company's online portal. Instead, we treat your situation like what it is: a personal injury case against a negligent corporation that caused this disaster.
This approach shifts the power dynamic entirely. We are not asking for a handout from a pre-established fund; we are demanding full compensation under the law for the negligence that destroyed your property and upended your life. This legal action is separate from, and typically in addition to, any insurance claim you may have. It is focused on securing compensation directly from the at-fault party for all your damages, including those your insurance policy will not cover.
Research from industry sources like the Insurance Research Council has shown that claimants who have legal representation receive, on average, settlements that are 3.5 times higher than those who do not. Engaging in the formal legal process signals to the corporation that you will not accept an undervalued offer.
How Do You Calculate What Your Wildfire Claim Is Actually Worth?
Property Damage (Beyond the Structure)
- Replacement Cost vs. Actual Cash Value: Initial offers typically use "actual cash value" (ACV), which is the value of your property minus depreciation for age and wear. We pursue the "replacement cost" (RCV)—what it actually costs to buy a new, similar item in today's market. This difference is enormous when you consider replacing everything from a roof to all the furniture in your home.
- Complete Personal Property Inventory: We work with you to create a detailed, room-by-room inventory of everything you lost. This methodical process ensures that smaller items, which add up to a significant value, are not overlooked.
- Landscaping and Outbuildings: The value of destroyed trees, gardens, sheds, fences, and other external property features are real losses that must be included in your claim.
Economic Damages (The Financial Fallout)
- Lost Wages and Future Earning Capacity: If the fire and its disruption impacted your ability to work, we document this lost income.
- Additional Living Expenses (ALE): This covers the cost of temporary housing, food, and other necessities while you are displaced. Your insurance policy has limits on this coverage, but a legal claim against the negligent corporation does not.
- Cost of Debris Removal and Site Preparation: These costs are substantial and are frequently underestimated in initial offers from insurers.
- Increased Cost of Construction: Rebuilding a home today means complying with current building codes, which are more stringent and expensive than the codes in place when your original home was built. This increase is a direct result of the fire and should be compensated.
Non-Economic Damages (The Human Cost)
This is the category most frequently ignored or minimized by initial offers, yet it represents a significant part of your loss. In California, the law recognizes that the harm from property loss goes beyond the financial cost.
These damages may include:
- Pain and Suffering: The physical discomfort and emotional trauma you have endured.
- Emotional Distress and Mental Anguish: Compensation for the loss of your home, your community, and your sense of safety. This includes conditions like anxiety or PTSD that arise from such a traumatic event.
- Loss of Use and Enjoyment of Property: The law provides for compensation when someone’s negligence prevents you from being able to use and enjoy your property as you once did.
What Does the Process of Rejecting an Offer and Pursuing a Legal Claim Look Like?
Step 1: Do Not Sign Anything
Once you sign a settlement release, you give up your right to seek any further compensation for this incident, forever. It is final. Do not sign or verbally agree to any offer without having it reviewed by an attorney who understands these specific types of cases.
Step 2: A Formal Rejection and Demand Letter
We will formally reject the inadequate offer on your behalf. Next, our firm prepares a comprehensive demand letter. This is a detailed legal document that methodically outlines the corporation’s liability, provides a full accounting of all your damages and presents a specific monetary demand for what constitutes a fair settlement.
Step 3: Negotiation or Litigation
The demand letter opens the door to serious, formal negotiations. The corporation and its lawyers now understand that you are represented by a serious legal team and have a fully documented case.
If they refuse to negotiate in good faith and offer a fair settlement, we do not hesitate to file a lawsuit. This action demonstrates that we are prepared to take the case to court to secure the compensation you are owed. Filing the suit is frequently enough to bring the other side back to the negotiating table with a much more reasonable offer.
Step 4: Resolution Through Settlement or Trial
The vast majority of these wildfire cases are resolved through a settlement before ever reaching a trial. We will handle all negotiations, keeping you informed at every stage and advising you on any offers received, but the ultimate decision to accept a settlement is always yours.
Frequently Asked Questions About Wildfire Settlement Offers
How long do I have to file a lawsuit after a wildfire?
In California, the statute of limitations for property damage is typically three years from the date of the fire. However, the deadline for personal injury is two years, and claims involving government entities have much shorter deadlines. Speak with an attorney as soon as possible to ensure your rights are protected.
Will I have to go to court if I reject the settlement offer?
It is unlikely. Most wildfire claims are settled out of court through structured negotiation, mediation, or another form of alternative dispute resolution. Filing a lawsuit is a powerful tool to compel a fair offer from the other side, but it rarely leads to a full trial.
Can I still pursue a claim if I've already received some money from my insurance?
Yes. An insurance payout covers your contractual claim with your insurance company, up to your policy limits. A legal claim against the negligent corporation that caused the fire is separate. It is meant to cover the full extent of your damages, which frequently far exceeds what your insurance policy will pay.
What if the company argues the fire was a "natural disaster"?
Many wildfires are preventable and are started by corporate negligence, such as poorly maintained power lines or failing to clear vegetation. Our firm focuses on investigating the specific cause of the fire to prove liability and hold the responsible party accountable, regardless of the excuses they make.
Don't Rebuild on Their Terms. Rebuild on Yours.
The settlement offer you received is just the start of a conversation, one that we are prepared to lead on your behalf.
We focus on holding negligent corporations accountable because we know that is the only way for families to truly recover everything they have lost. The sooner we begin our investigation and the preservation of evidence, the stronger your case will be.
To discuss your low settlement offer and learn how we pursue the full compensation available under the law, call the Bernheim Law Firm today at (800) WILDFIRE.