Around the PIA Western Alliance States- Week of February 10, 2025

California — Commissioner Lara urges insurance companies to provide full contents coverage without detailed inventory requirements for wildfire survivors: Insurance Commissioner Ricardo Lara issued a Notice to all residential property insurance companies in California, calling for swift action to aid wildfire survivors impacted by recent fires in Southern California, including the Palisades and Eaton fires. Following the 2018 wildfires, laws sponsored by Commissioner Lara entitle policyholders who experience a total loss to advance payments on their personal property claims. To facilitate further recovery from these devastating losses, Commissioner Lara is encouraging insurance companies to exceed current legal obligations by providing 100 percent of contents coverage limits without the need for policyholders to submit a detailed inventory of their personal property.

“It is inhumane to require wildfire survivors who have lost everything to list every item of personal property in order to receive the full replacement cost under their policies — they need to focus on the larger task of rebuilding their lives,” said Commissioner Lara. “I commend the insurance companies that prioritize their policyholders in the aftermath of these fires. Now is the time for all other insurers, including the California FAIR Plan, to step up and do the right thing for their customers.”

The Department acknowledges that some insurers have gone beyond existing legal requirements, making substantial efforts to support policyholders by providing 75 percent, 80 percent, or even 100 percent of contents limits without requiring an inventory. Policyholders can still recover the full value of their destroyed personal property, up to policy limits, by completing a full inventory later on.

The Commissioner’s Notice requests that insurance companies respond to the Department by February 28, 2025, regarding their compliance with this request. This Notice builds on the Commissioner’s Bulletin issued on January 23, 2025, which reminded insurance companies of important consumer protections under existing law that mandate certain advance payments once a state of emergency is declared and a property is deemed a total loss.

Background:

Current law requires insurance companies to provide advance funds for replacing personal property or contents, amounting to no less than 30 percent of the policy’s dwelling limit, up to $250,000, without necessitating an itemized claim from the policyholder once a state of emergency has been declared and a property is identified as a total loss. Insurers are required to automatically inform policyholders of this option upfront. After receiving the advance payment for contents, policyholders can recover the full value of their destroyed personal property, up to their contents policy limits, by meeting the necessary documentation requirements.

California — Commissioner Lara alerts Californians about coverage for floods and mudslides caused by Los Angeles County wildfires: As colder, wetter weather occurs throughout the state and the threat of mudslides increases, especially for Los Angeles County wildfire survivors in burn areas who are even more vulnerable, Insurance Commissioner Ricardo Lara issued a Bulletin to insurance companies reminding them of their legal duty to cover damage from any future mudslide or similar disaster that is caused by recent wildfires that weakened hillsides.

Many people may not be aware that homeowners’ and commercial insurance policies typically exclude flood, mudslide, debris flow, and other similar disasters — unless they are directly or indirectly caused by a recent wildfire or another peril covered by the applicable insurance policy. The Department of Insurance has posted a fact sheet for consumers to answer questions about what their policies cover.

“With the recent wildfires in Los Angeles County leaving communities vulnerable, and winter storms posing an increased threat, it’s critical for residents to understand their protections,” said Commissioner Lara. “I am reminding insurance companies of their legal obligation to cover any mudslides, debris flows, or other damage resulting from these fires so that affected individuals can recover as quickly as possible."

The Montecito mudslide in Santa Barbara County in January 2018 that followed the destructive Thomas Fire claimed 23 lives and caused more than $421 million in damage, according to Department of Insurance data. Following that disaster, the Governor enacted a new law to help prevent confusion about coverage following mudslides.

Due to the scale of the recent Los Angeles County wildfires and the current and potential flooding, the Department of Insurance preemptively issued today’s Bulletin to all property and casualty insurance companies to ensure consumers are protected.

Commissioner Lara also urged consumers to take the following steps to prepare for the winter storm season:

Use their smart phone to perform a home inventory to create a record of their belongings and store scans of important documents that they can easily access.

Locate their insurance papers and put in a safe place or upload to an online location.

For renters, consider purchasing renters’ insurance to protect their personal belongings, which typically are not covered by their landlord’s homeowners’ policy.

Consider comprehensive auto insurance, which would protect their vehicle in the event of flood damage.

Visit the Governor’s Office of Emergency Services (CalOES) “winter wise” web page to read more tips to prepare for winter weather.

Consider flood insurance for future disasters in addition to their homeowners’ insurance policy. The National Flood Insurance Program currently provides the majority of flood coverage written in the state, but private flood insurance is also available. Flood insurance takes effect 30 days after it is purchased, except in the case of a home purchase where flood insurance is required by the lender.

The Department of Insurance can help consumers with insurance coverage or claim questions. Contact us at our consumer hotline at 800-927-4357 or through online chat or email at insurance.ca.gov.

Hawaii — Jerry Bump Named Acting Insurance Commissioner: Jerry Bump has been named the acting Insurance Commissioner for the state of Hawai‘i Department of Commerce and Consumer Affairs (DCCA) Insurance Division (INS), effective February 1.

Bump transitions into this role following the retirement of Gordon Ito, who served as the Insurance Commissioner for a total of 10 years cumulatively and had worked in INS in various capacities for the past 31 years. As acting Insurance Commissioner, Bump is responsible for overseeing the insurance industry in the state of Hawai‘i, which includes companies, insurance agents, self-insurers and captives.

INS ensures that consumers are provided with insurance services meeting acceptable standards of quality, equity and dependability at fair rates by establishing and enforcing appropriate service standards. INS consists of seven branches, the Financial Surveillance and Examination Branch, Compliance and Enforcement Branch, Licensing Branch, Rate and Policy Analysis Branch, Captive Insurance Branch, Insurance Fraud Investigation Branch, and Health Insurance Branch. The seven branches closely interact with each other in attaining the common goal of safeguarding the public interest by monitoring the insurance company activities to ensure that acceptable standards are maintained and by fairly administering the Insurance Code.

Bump joined the Hawai‘i Insurance Division in 2008 as an Insurance Program Specialist and served as Chief Deputy Insurance Commissioner since 2023. Prior to joining INS, he had a 13-year career with Pacific Guardian Life Insurance Company and worked in public accounting as an Auditor.

“I look forward to collaborating with industry professionals, policymakers and consumers to promote stability and innovation in our insurance landscape,” said Bump. “I am grateful for the leadership Gordon Ito provided and will work diligently to uphold the trust and confidence placed in our division,” continued Bump.

“We extend our gratitude to Gordon Ito for his exemplary service over the past 31 years,” said DCCA Director Nadine Ando. “As Jerry Bump assumes the role of acting Insurance Commissioner, we are confident that his leadership will guide the Insurance Division forward in upholding regulatory standards and serving the people of Hawai‘i,” concluded Ando.

Bump is a graduate of Moanalua High School and received his undergraduate degree in business administration from the University of Hawai‘i at Manoa. He is a licensed Certified Public Accountant since 2001.

The insurance industry is experiencing a hard market, characterized by high rates and limited availability. Insurance rates have been increasing over the past several years across the nation. Reinsurance markets, or insurance for insurance companies to manage risks, have contracted resulting in increasing rates to insurance carriers for reinsurance policies. Amidst a challenging market cycle predating the Maui wildfires, the reinsurance market has observed losses of approximately $100 billion in four of the past five years. Nationwide rate increases, influenced by reinsurance market contractions, have led to substantial cost increases upward of 50% for carriers over the past several years. Insurers are reevaluating risks, impacting availability and affordability.

In preparation for a potential decline in the availability of insurance within the Hawai‘i market, the Hawai‘i Property Insurance Association has been working on expanding its capacity, to increase its coverage limits as well as procure a new IT system to be responsive to the market’s needs, including potentially writing condominium units’ policies and AOAO master policies to cover potential losses, excluding hurricane losses. The Hawaii Hurricane Relief Fund Board was reconstituted, convening its first meeting on July 25, 2024. INS continues to actively work with insurers to maintain availability of coverage and affordable options in compliance with statutory mandates.

INS publishes an annual premium comparison sheet and guide for homeowners, condominiums and rentals and motor vehicle insurance. Policyholders receiving non-renewal notices or significant rate increases should explore alternative insurers. The premium comparison guide and other resources are available on the INS website at https://cca.hawaii.gov/ins/.

Oregon — Oregon DFR encourages people to protect themselves against relationship investment scams: The Oregon Division of Financial Regulation (DFR) is warning people to be wary of an unexpected text or direct message from a stranger – it might be the first step in a relationship investment scam, also known as a romance scam or “pig butchering.” These scams often involve fraudsters contacting targets seemingly at random, using social media or common communication apps.

The scammer gains the target’s trust, often by starting a romantic relationship or a friendship. The scammer then starts to convince the victim to invest in phony investments, including fraudulent cryptocurrency schemes, before falsely claiming the initial investment grew significantly. The scammer then asks for more money and demands payment of fees or taxes if the victim requests to withdraw the funds. Even when the victim pays the withdrawal fees, the fraudster does not refund the victim's money, but rather disappears with the funds without any further communication.

According to the Financial Industry Regulatory Authority (FINRA), there are several warning signs to be aware of involving these types of scams:

Unexpected contact: Never respond to unsolicited messages from unknown contacts, even about seemingly benign topics, especially through text message or on encrypted messaging applications like WhatsApp or Telegram.

Refusal to participate in video chats:If someone you have been messaging declines to interact face-to-face, they likely are not the person from the profile photo.

Request for financial information: Don't share any personal financial information with anyone you have never met in person. If a new virtual friend or romantic connection starts making financial inquiries, put the brakes on the relationship.

Invitation to invest in specific financial products:Be wary of any unsolicited investment advice or tips, particularly from someone you have spoken to only online, even if they suggest you trade through your own account. Always question what a source has to gain from sharing tips with you and whether the transaction fits with your financial goals and investment strategy.

Unknown or confusing investment opportunity:Carefully evaluate the product, as well as the person or company requesting your investment. Along with a basic search, try adding words such as “scam" or “fraud" to see what results come up. Consider running recommendations by a third party or an investment professional who has no stake in the investment and use FINRA BrokerCheck to see if the promoter is a registered investment professional.

Unfamiliar trading platforms:Do extensive research before moving any money, particularly in an emerging market such as cryptocurrency, which has hundreds of exchanges and new avenues for trading that continue to evolve. Who controls the platform? What security measures are in place? How can you withdraw funds if needed? If you don't know the answers to those questions, do not put your assets there.

Exaggerated claims and elevated emotions:Take a closer look at any investment that offers much higher than average returns or is touted as “guaranteed.” Fraudsters will also often use their knowledge about you to appeal to your emotions – for example, “Don't you want to have money to send your kids to college?”

Sense of urgency about an upcoming news announcement or share price increase:Remember that insider trading is illegal. You should never trade in shares of a company on the basis of material, nonpublic information.

“Romance and crypto scams continue to be the source of significant losses for consumers,” said TK Keen, DFR administrator. “Consumers who receive contacts out of the blue through messaging apps on their phone or other means should be especially suspicious of those trying to entice them into cryptocurrency or any other investments.”

Several states and federal authorities have issued warnings about this type of fraud. In 2023, investment fraud caused the highest losses of any scam reported by the public to the FBI's Internet Crimes Complaint Center (IC3), totaling $4.57 billion, a 38 percent increase from 2022. Frauds involving cryptocurrency, including relationship investment scams, increased from $2.57 million in 2022 to $3.96 billion in 2023, a 53 percent rise. DFR accepts consumer complaints relating to investment fraud and will forward other scam complaints to the appropriate law enforcement authorities. Consumers should also report scams to the FBI's IC3 at https://www.ic3.gov/. Learn more about relationship investment scams and how to outsmart scammers by visiting DFR’s website.

Anyone who thinks they may have been a victim of a relationship investment scam can fill out our online complaint form or contact DFR’s consumer advocates at 1-888-877-4894 (toll-free) or email dfr.financialserviceshelp@dcbs.oregon.gov.

Washington — Treat but no transport survey deadline extension: The 2024 Legislature enacted Substitute Senate Bill 5986 (SSB 5986). Section 13 of this law directs the OIC to contract for actuarial analysis on the cost, potential cost savings, and total net costs or savings of covering services provided by ground ambulance services organizations (GASOs) when a GASO is dispatched to the scene of an emergency and the person is treated but is not transported to a hospital or behavioral health emergency services provider.

Lewis and Ellis (L&E) and their subcontractor Public Consulting Group (PCG) were selected for this contract and have begun data collection efforts to assess whether and how treat but no transport services are provided by GASOs in Washington state. The survey included in this email is the primary data collection tool that will be used by our contractors.

This survey is critical for gathering information directly from GASOs about how treat but no transport services are currently being rendered, the cost of these services, and the benefits and drawbacks to potentially covering these services through private health insurance plans.

The Lewis & Ellis team recognizes that departments might not currently bill for Treat-no-Transport services. We still encourage you to indicate that you provide Treat-no-Transport services if you dispatch an ambulance to a scene, render treatment on site, and do not ultimately transport patients (even if you are not billing for the service). Through this effort and your participation, we hope to gather information about the cost of these services and the benefits of potentially covering these services through private health insurance plans.

The survey is available here: https://pcgus.jotform.com/team/wa-treat-no-transport-rate-study/Survey.

The survey response deadline has been extended.

Survey responses are now due on February 6, 2025, by 11:59 p.m.

If you have any questions about this survey, please contact PCG at WATNT@pcgus.com.

For general questions about the treat but no transport analysis, please contact policy@oic.wa.gov.