Guest Blog from Cang N. Le, Esq.
This article first appeared in the CAI Channel Islands Chapter Magazine, Channels of Communication, First Quarter 2025 Issue.
The devastating wildfires in Los Angeles have profoundly impacted homeowners associations (HOAs) and the common interest developments (CIDs) they manage. These communities, often built around shared amenities and governed by complex regulations, face unique challenges in the aftermath of such widespread destruction. From navigating insurance claims and debris removal to addressing rebuilding logistics and financial burdens, HOAs must take strategic steps to restore their communities.
With nearly two decades of experience in the HOA industry—first as an attorney representing HOAs in litigation and now as the president of CM2 & Associates, Inc., a turnkey construction firm specializing in HOA communities—I have seen firsthand the challenges HOAs face during recovery. Based on this experience, I offer the following insights on key considerations for navigating the rebuilding process.
Review Your CC&Rs and Legal Procedures for Rebuilding
Many HOA-managed communities have suffered significant structural losses due to fire damage, including residential units, clubhouses, and other shared facilities. The extent of damage varies, with some neighborhoods experiencing total destruction while others endure partial losses.
Buried in the back pages of declaration of covenants, conditions, and restrictions (CC&Rs) – the primary governing document for HOAs – are provisions usually entitled “Destruction of Improvements” related to the partial or full destruction of a community. Rarely are these provisions reviewed. However, due to the tragedy of the LA fires and the destruction caused to some communities, these provisions must now be analyzed and reviewed to determine the steps that an HOA must take to rebuild their communities. The requirements for rebuilding typically depend on the availability and adequacy of insurance coverage and may require membership approval. As communities rebuild, revisiting these governing documents and amending them, if necessary, could help HOAs address their particular situation after these fires and be better prepared for future disasters.
Further, with the destruction of homes and common areas, HOAs must determine how to finance repairs and rebuild their communities. Many associations rely on reserves, but these funds may be insufficient to cover extensive losses. Special or emergency assessments on homeowners may be necessary, adding further financial burdens on residents who are already facing personal losses and relocation expenses. Association leaders should be proactive in communicating the financial realities of reconstruction, providing transparency regarding insurance payouts, special or emergency assessments, and expected timelines.
Understanding the legal framework surrounding rebuilding efforts is essential to avoiding disputes between homeowners and the HOA, as well as determining whether and how to proceed with reconstruction.
Navigating CC&Rs, insurance claims, and financial planning after a wildfire is complex, making professional guidance essential. HOA boards should collaborate with legal counsel, insurance agents, and specialists in disaster recovery and property law to ensure their rebuilding process is legally sound, financially viable, and tailored to the unique challenges of post-wildfire reconstruction.
Insurance Challenges
As to insurance, even before the LA fires, insurers had already been reassessing their risk exposure, and many communities and homeowners had seen increased premiums or even policy cancellations. The LA fires will only exacerbate the insurance issues faced by many communities and their homeowners. The current crisis will further expose potential coverage gaps, delay claim processing, and increase the cost of not only rebuilding and insurance in general. This impact will extend beyond fire-damaged communities, affecting HOAs throughout California.
With rising wildfire risks, many insurers are reducing their coverage in high-risk areas or exiting the market altogether. HOAs that have relied on traditional policies may find themselves needing to secure coverage through the California FAIR Plan, the state’s insurer of last resort. However, FAIR Plan policies often come with higher premiums and limited coverage, creating additional financial strain on HOA communities.
HOAs must work closely with insurance providers to clarify coverage terms and evaluate whether there is adequate funding for reconstruction efforts. This involves conducting thorough policy reviews, understanding exclusions related to wildfires, and seeking additional coverage options where necessary. HOAs may need to consult insurance coverage experts to contest exclusions or denials of claims related to common area coverage. HOAs should also educate homeowners on the importance of maintaining individual fire insurance policies and encourage them to file individual claims when applicable.
Further, HOAs should stay informed on pending insurance legislation and see how they can support efforts that protect their communities and homes. State lawmakers are currently evaluating policy measures to address the crisis, such as requiring insurers to maintain coverage in wildfire- prone areas or establishing risk-sharing pools to stabilize premium rates. Active participation in advocacy groups and engagement with legislators can help ensure that HOA interests are represented in these discussions.
Debris Removal and Contractor Concerns
The immediate aftermath of the fires has led to a pressing need for debris removal. Environmental workers are racing against time to clear hazardous materials, including batteries, paint cans, and chemicals, before larger debris clearance efforts can commence. The U.S. Environmental Protection Agency (EPA) has been tasked with expediting this cleanup, facing challenges such as the extensive range of affected properties and the risks posed by lithium-ion batteries.
For HOA communities, managing debris removal presents additional complexities. Shared properties and common areas require coordinated efforts between HOA boards, residents, and government agencies. HOAs must work with state and federal agencies to ensure safe and efficient debris removal while balancing costs and potential legal liabilities. Additionally, disputes may arise over responsibility for debris clearance on common area and private properties within HOA jurisdictions.
The scale of destruction has also led to concerns about contractor availability. With multiple regions across the country simultaneously undertaking rebuilding efforts due to various natural disasters, there is intense competition for skilled labor and resources. This competition is expected to slow down recovery processes and increase costs, creating further financial strain on HOA communities. Delays in securing contractors could result in prolonged displacement of residents and increased legal disputes over rebuilding timelines and contract terms.
HOAs must also remain vigilant against unethical contractors engaging in price gouging or misrepresenting their qualifications. Scammers and unlicensed contractors often exploit disaster situations by overcharging for services or failing to meet contractual obligations. To mitigate these risks, HOA boards should establish strict vetting procedures when selecting contractors, verifying their licensing, experience, and past work history in wildfire-affected areas. Consulting with legal professionals and working closely with municipal authorities can further protect HOA communities from fraudulent activities.
HOAs should partner with reputable construction firms, leveraging bulk contracts to secure fair pricing and quality workmanship. Negotiating long-term agreements with contractors before disaster strikes may provide priority access to labor and materials, reducing post-disaster delays. Furthermore, engaging with local trade organizations and industry groups can provide additional resources for finding skilled labor and ensuring fair market pricing.
Preparing for the Future and Next Emergency
Given the increasing frequency and severity of wildfires, HOAs must take proactive steps to enhance fire resilience. Architectural guidelines should be amended to prioritize fire safety improvements and incorporate fire-resistant building standards which can significantly reduce the risk of structural loss and improve the overall safety of the community.
HOAs should allow or even mandate the use of non- combustible or fire-resistant materials for new construction, remodels, and repairs. Such material could include:
- Class A fire-rated roofing (e.g., metal, slate, tile, or treated asphalt shingles)
- Fire-resistant siding (e.g., fiber cement, stucco, brick, or stone)
- Ember-resistant vents and enclosed eaves to prevent embers from entering structures
- Dual-pane, tempered glass windows for increased heat resistance
- Non-combustible fencing (e.g., metal, masonry) or treated fire-resistant wood.
- Decking materials that meet California Wildland-Urban Interface (WUI) fire codes.
- Enclosure of open decks to reduce ember intrusion.
- Changes to approved buildings materials and architectural standards should also be considered for the common areas. HOA should consider upgrades so their common areas and infrastructure that includes:
- Retrofitting for non-combustible materials to the components for individuals home noted above,
- Fire-resistant perimeter walls and gates.
- Fire-retardant painting and coatings on community roofs, structures, signs, mailboxes, and playgrounds; and
- Sprinkler systems in common areas for additional fire suppression.
Landscaping guidelines should require defensible space zones around homes and common areas. These zones create a buffer that slows the spread of fire and provides better access for firefighting efforts. The best practices for defensible space include:
- Maintain a minimum 30-foot clearance of flammable vegetation around structures.
- Require fire-resistant landscaping, such as drought- tolerant, low-combustibility plants.
- Prohibit planting highly flammable trees (e.g., pine, eucalyptus, juniper) near homes.
- Ensure proper spacing between trees and shrubs to prevent fire from jumping between structures.
- Enforce mandatory maintenance (e.g., removal of dead vegetation, trimming overhanging branches).
- HOAs should collaborate with local fire officials to implement regular fire risk assessments, ensuring compliance with defensible space requirements, evaluating structural fire risks (e.g., open eaves, vent vulnerabilities, outdated roofing materials), and reviewing community-wide evacuation routes and emergency access roads.
- Undertaking these changes could also provide insurance benefits. Some insurers may offer premium discounts for communities that proactively implement fire safety measures. HOAs should work with insurance providers to determine which fire mitigation upgrades may reduce rates for homeowners. Offering community-wide bulk discounts on fire-resistant materials can encourage compliance and reduce overall costs for residents.
Reviewing CC&Rs is crucial to understanding rebuilding requirements, insurance coverage, and member approvals,
The Los Angeles wildfires have created significant challenges for HOAs, requiring immediate action and long-term planning for recovery. Reviewing CC&Rs is crucial to understanding rebuilding requirements, insurance coverage, and member approvals, while the ongoing insurance crisis demands proactive engagement with insurers and policymakers. Debris removal poses environmental, logistical, and financial challenges, requiring careful management to prevent fraud and inflated costs. Moving forward, HOAs must enhance disaster preparedness, update governing documents, and implement stronger fire prevention strategies. Prioritizing community engagement, financial planning, and collaboration with legal and insurance professionals will help ensure a more resilient recovery and better protection against future disasters.
