Carmel fire
The Carmel fire, which began on December 2, 2010, burned down 74 homes. Photo by Hagai Farid
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The government will base compensation for families whose homes were destroyed in the Carmel fire on the families' income level and whether the homes were insured, under guidelines being drafted by Finance Ministry Accountant General Shuki Oren.

Oren is in the final stages of drafting the compensation policy for the fire.

While only 74 homes were destroyed, and despite the desires to help the few people who lost everything, the compensation is expected to become a precedent in the case of future disasters, such as an earthquake. Therefore, care is being taken to ensure that it reflects the government's policy. The destroyed homes were in Beit Oren, Ein Hod and the Yemin Orde youth village. The main issue is that several homes in the village of Ein Hod had no fire insurance at all. Yemin Orde was fully insured, and therefore needs almost no government assistance. Beit Oren was partially insured.

The first factor in setting compensation will be the income and assets of the family that lost its home. Oren intends to set a minimum level of per capita earnings and assets for receiving compensation. Families above this level should be able to rebuild on their own, regardless of whether they have insurance. Someone who is fully insured will not receive money from the government, because he or she will get what is needed to rebuild from the insurance companies.

Families below the minimum wealth level will receive government compensation based on how much insurance they had. Preference will be given to families that had at least some insurance, in order not to create an incentive for people to forgo insurance altogether.

People with no insurance altogether are likely to receive the money they would need for a down payment on a mortgage to build a modest home. For instance, this means the government will give them money equal to no more than 60% of the value of, say, an 80-square-meter home, even if this is much smaller than the house that was destroyed.

People who had partial insurance will receive money from the insurance companies that could be used toward a mortgage. In such cases, the government will give homeowners an additional percentage of the home's value - for instance, if the insurance company is covering 60% of the home's value, the government may contribute another 20%. While the government may give a family with partial insurance less money than it gives a family with no insurance, the former family will be left better off.

The final details of the assistance package have not yet been agreed on. Beyond money to rebuild, people harmed by the fire already have received money to cover one year of rent as well as a one-time grant of NIS 2,500 per person. In addition, people with insurance already have received the first payouts. Oren's office praised the conduct of the insurance companies, saying they organized quickly to help the fire victims.