@Tanks is correct about the same square footage keeping prop 13 still in affect; however I will add the one phrase that very few people are talking about and you inadvertently touched on when you said....
"My old CA friend tells me a lot of those places are generational being passed down over the years"
The phrase of death for these people looking to rebuild is..... "PERMITTING & INSPECTION"
Some of these people who have inherited these properties for generations are about to be slapped in the mouth with the reality that the home they've had for generations can no longer be built as it was; so even if they do rebuild the same square footage the cost of building will likely be 3X higher than what the house is valued at on the tax rolls.
Also, property taxes will only be lowered by "misfortune/calamity" - Meaning that you can apply to the assessors office that your home burned and thus is not worth the same as listed on the tax rolls; but they will only be lowered by structural loss.
Meaning that if your total property value is $3mil and the structure is valued at $1mil..... then you are still on the hook for paying taxes on $2mil value of the land. So you will be stuck paying 2/3rds of your property tax bill with no house to live in; that alone will force many moderate/less affluent people to sell out as I can only imagine the hell scape of trying to pull a building permit in that environment..... not to mention the engineer/architect fees that will come from submitting plans and approval process, and most likely environmental/costal commission approval as well.
I predict we'll see more of the same from other California wild fires - You'll have LOTS of people throw their hands up and take their insurance/buy out checks and move to Arizona, Texas, Florida, Tennessee, ect.
Of course people are taking advantage of the misfortune of others, I was watching an investment podcast yesterday and they showed a video of a California real estate agent who immediately raised all the rental prices of her properties by 100%.
"People are desperate.... IT'S PROFIT TIME!".... she gleefully proclaimed as she explained her justification on raising the monthly rent for a 3 bedroom furnished home from $15K per month to $30K per month.