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Wildfire Disclosure Report from FortressFire

by | Nov 3, 2023 | Contracts and Forms, Copyright, Department of Real Estate, Uncategorized

BROKER RISK MANAGEMENT

WEEKLY PRACTICE TIP

On Wednesday, November 1, 2023, CAR in conjunction with FortressFire announced the availability of a new “Wildfire Disclosure Report” (WFDR) which can be ordered directly as an optional report in the Residential Purchase Agreement (RPA) in ¶ 3Q(2) in the grid.

 

Here is what you need to know about this report, what it does and how it can be used.

 

  1. What is the WFDR? This is an OPTIONAL report, totally separate from an NHD report, that assesses the wildfire risks and characteristics of any residential property in California, and makes recommendations for wildfire mitigation steps to improve the property’s resistance to wildfires.

 

  • The detailed information in an WFDR is not contained in an NHD report
  • It does not replace or expand the existing Fire Hardening and Defensible Space (FHDS) form nor the existing disclosure obligations of a seller in that form.
  • The WFDR gives each property a “Current Vulnerability Score” and makes recommendations regarding how to reduce the property’s vulnerability to a wildfire and thus, reduce that score by specifically recommended mitigation measures. (Lower is better).

 

  1. What does a WFDR contain? The WFDR includes:
  • Fuel Load Analysis: Assesses the property’s vegetation density to understand fire fuel potential.
  • Topographical Insights: Understanding how the terrain may influence fire behavior and spread.
  • Proximity to Fire-Prone Areas: Identifies potential risks based on the property’s location.
  • Compliance with State Regulations: Documents the status for AB 38 inspections and insurance coverage options.
  • Mitigation Recommendations and Costs: Offers personalized strategies to mitigate vulnerabilities and enhance insurability.

 

  1. Who can Order a WFDR?  Anybody can order a WFDR at any time and it can be ordered through the most widely used NHD companies. 

 

  • SELLERS: For example, a property owner can order a WFDR in advance of putting a property on the market, learn the property’s vulnerability to a wildfire, and perhaps decide to take mitigation steps to reduce the Current Vulnerability Score making the property more desirable to buyers. NOTE: If a seller has a WFDR, that report must be disclosed to buyers as with all other reports in a seller’s possession.

 

  • BUYERS:  A buyer can check the box in RPA ¶ 3Q(2) in the grid and select the FortressFire WFDR to be ordered and paid for by seller, buyer or split between them, as with all other costs in RPA ¶ 3Q.

 

Who is ForestFire?  ForestFire is a “CAR-Partner Program” company that has spent the past two years developing and improving the WFDR.  CAR has partnered with FortressFire to provide WFDRs in California that “document the specific vulnerabilities of a home and provide a roadmap for how to protect and insure it, providing more informed and effective real estate transactions.”

 

According to CAR:  “The WFDR uses a patent-pending physics-based model to identify the specific vulnerabilities of a home, the specific fuels that will cause the house to burn, along with cost estimates to eliminate those vulnerabilities and greatly reduce the risk of destruction in the event of wildfire.  These insights and recommended actions put homeowners on the path to insurability and more affordable rates.”

 

WHERE CAN I OBTAIN ADDITIONAL INFORMATION:

 

If you want to view the one-hour CAR sponsored webinar on the WFDR, here is a link to the recording:

players.brightcove.net/876630612001/default_default/index.html?videoId=6340308382112

 

CAR has an information page that lists what the WFDR includes Sample Reports, where and how to order an WFDR, and an FAQ at:  Wildfire Disclosure Report (car.org)

 

WEEKLY PRACTICE TIP: DO NOT FORWARD TO CLIENTS.  This Weekly Practice Tip is an attorney-client privileged communication for the exclusive use of clients of Broker Risk Management and their agents.  It may not be reproduced or distributed without the express written consent of Broker Risk Management LLP.  The advice and recommendations contained herein are not necessarily indicative of standards of care in the industry, but rather are intended to suggest good risk management practices.