Thursday, July 05, 2012

Insurance Companies Sue Colorado Over Prescribed Burn

Five insurance companies sued Colorado on behalf of 22 homeowners whose houses were damaged or destroyed by a prescribed burn that got out of control. American Family Mutual Insurance and four other insurers sued the state and the Colorado State Forest Service, an agency of Colorado State University, in Jefferson County Court. The wildfire at issue, the Lower North Fork Fire, was set by state employees in late March southwest of Denver, 3 months before the most destructive wildfires in Colorado history destroyed more than 600 homes and killed six people. Prescribed burns are set to reduce fuel before fire seasons become dangerous. When set during a wildfire, in the path of a fire, they are known as backfires. In May, after the North Fork Fire, the Colorado Legislature reached a deal stripping itself of immunity for prescribed burns that got out of control, and removing a $600,000 cap on state liability for all claims arising from a single incident, the Denver Post reportedat the time. The North Fork Fire burned more than 20 homes and 4,000 acres by May 3. The five insurers-American Family Mutual, Safeco, Allstate, IDS Property Casualty Insurance and Federated Mutual-claim it was the state's fault: "A three-person crew was monitoring Unit 4a when embers from the prescribed burn lit by the defendant were carried across the prescribed fire control lines creating spot fires. These spot fires could not be contained by the three-person crew and quickly spread, resulting in the Lower North Fork Fire," according to the complaint. The insurers say the fire was no fault of their policyholders, who have been or will be paid...more

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