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Farmers cancels insurance for 300+ homes in Tierrasanta

Large condo complex scrambles to find wildfire coverage on open market.

SAN DIEGO — A condo complex in Tierrasanta with more than 300 units is scrambling to find property insurance for wildfire coverage. Earlier this month, Farmers Insurance suddenly canceled the policy for all homeowners in the Villa Monterey community.

Jon Morrone and his wife have lived in the condo complex off Antigue Blvd. for the past nine years.

“If this comes to fruition, I think a lot of people will wind up losing their homes,” said Morrone.

The condos in Villa Monterey are connected, meaning they share walls.

As a result, owners pay about $380 a month in Condominium Owner’s Association (COA) fees, which include property insurance for the entire complex.

“It's one blanket policy,” said Morrone.

The community sits on a canyon, and that appears to be the reason why Farmers Insurance canceled the insurance policy for the entire complex, leaving the owner’s association scrambling to find a new policy.

Currently, the estimated cost for a replacement policy could add an additional $7,000 per year for each condo owner.

“It's devastating. A lot of these families are either young people with children or older people on fixed incomes.  And if this happened, it would be financially crippling,” said Morrone.

The Farmers Insurance policy that was canceled covered up to $127 million property damages at a cost of $130,000 annually. The replacement policy bundled together by an insurance broker would only cover and estimated $47 million in damages, and cost more than $2.2 million per year, according to COA documents emailed to owners.

COA board members are now considering changing the association’s CC&Rs to “shift the insurance responsibility from the Association… to each separate owner,” internal documents stated.

An informational town hall meeting was scheduled for Tuesday, January 31 at 6 p.m. at the Villa Monterey clubhouse.

CBS 8 reached out to Farmers Insurance for comment, but we did not receive a response. 

COA board members and the Villa Monterey property management company, The Prescott Companies, also did not respond to messages from CBS 8.

The insurance cancelation appears to be related to wildfire risk, according to COA records.

“They're fearful that if there's another event like what happened in Scripps Ranch in '03 and '07 – where entire neighborhoods are lost – that it would be a financial hardship on the insurance company,” said Morrone.

Earlier this month, Farmers Insurance also canceled its property coverage for the Canyon Park Villas condos in Rancho Penasquitos, according to a published report in the San Diego Union-Tribune.

“I think it would be it would definitely be a lot cheaper to mitigate that canyon brush than to spend an insane amount of money for an insurance policy that basically covers a third of what we need,” said Morrone.

The California Department of Insurance did not respond to a message seeking comment for this report.

At CBS 8, we are always Working for You and our San Diego community. If there is something you would like us to investigate, please share your idea here or email us at workingforyou@cbs8.com. 

WATCH RELATED: Seniors receive help with HOA insurance after CBS 8 story (Jan. 2022).


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