Around the PIA Western Alliance States – Week of March 17, 2025

California — Commissioner Lara urges Californians to understand insurance coverage for floods and mudslides: With sustained rains and an approaching atmospheric river increasing the risk of mudslides, Insurance Commissioner Ricardo Lara is reminding residents—especially those in wildfire-affected areas—that insurance companies are legally required to cover mudslides and debris flows if they result from recent fires that have destabilized hillsides.

“Protecting consumers is our main focus,” said Commissioner Lara. “With this atmospheric river on the way, communities recovering from wildfires face an even greater risk. It’s critical for Southern California residents to understand their insurance protections and take the necessary steps to secure the assistance they need. Those impacted should check their policies and seek help to make sure they receive the coverage they deserve.”

Wildfire-scorched landscapes, often referred to as “burn scars,” leave hillsides vulnerable to flash floods and debris flows. Without vegetation to absorb rainfall, water rapidly runs off, and extreme wildfire heat can create a water-repellent soil layer, further amplifying the risk. Even light rain can trigger dangerous flooding, especially in steep areas. Homes, roads, and infrastructure near recent burn area face heightened danger, often with little warning.

Many policyholders 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.

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.

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.

Idaho — NAIC Manual: This Bulletin provides guidance regarding the version of the NAIC’s Accounting Practices and Procedures Manual to be used by authorized insurers when preparing 2025 quarterly and annual financial statements filed with the Idaho Department of Insurance and the NAIC, pursuant to Idaho Code Sections 41-210(4), 41-335, and 41-336.

Additionally, this Bulletin provides guidance for minimum reserve requirements regarding the version of the NAIC’s Valuation Manual to be used by authorized insurers providing life insurance, accident and health (A&H) insurance, annuity contracts, and deposit-type contracts when calculating reserve amounts to be reported to the Idaho Department of Insurance and the NAIC, pursuant to Idaho Code § 41-612.

Unless otherwise prescribed or permitted, the March 2025 version of the NAIC’s Accounting Practices and Procedures Manual, which applies to the 2025 quarterly and annual financial statements, has been adopted by the Director.

Unless otherwise prescribed or permitted, the January 1, 2025, edition of the NAIC’s Valuation Manual, which applies to the 2025 quarterly and annual financial statements, has been adopted by the Director.

Pursuant to Idaho Code, Sections 41-6305(1) and 41-6403(1), the NAIC’s Financial Analysis Handbook, 2024 Annual and 2025 Quarterly Edition, is prescribed.

This Bulletin is not new law but is an agency interpretation of existing law, except as authorized by law or as incorporated into a contract. Requests for additional information or other inquiries regarding this Bulletin can be directed to the Company Activities Bureau Chief/Chief Examiner, Eric Fletcher at 208-334-4230 or Eric.Fletcher@doi.idaho.gov.

Oregon — Residency Requirement for Title Insurance Producers: Oregon law currently prohibits DCBS from issuing title insurance producer licenses to nonresidents. See ORS 744.062(1)(i), 744.063(6). A nonresident who seeks a title insurance producer license filed a lawsuit claiming that this residency requirement violates the Privileges and Immunities Clause of the U.S. Constitution. DCBS has informed the court that it agrees the residency requirement is unconstitutional.

The U.S. District Court for the District of Oregon has invited interested parties to file amicus briefs regarding this issue by April 21, 2025. The details of the court’s invitation are included in the attached order. See Order Inviting Amicus Briefing, Polk v. Stolfi, No. 3:24-cv-01670-IM (D. Or. Mar. 7, 2025).

If you do not wish to participate in this legal proceeding, no action is required. If you have questions regarding this notice, please contact the DCBS's counsel in this case, Senior Assistant Attorney General Brian Marshall of the Oregon Department of Justice, at Brian.S.Marshall@doj.oregon.gov.

Washington — Sen. Bob Hasegawa on the credit scoring study bill: OIC Answers has moved to the Capitol for the time being, setting up the mics and mixing board in the Insurance Building for a few legislative session-inspired episodes.

This week, Senator Bob Hasegawa — Chair of the Senate Democratic Caucus from District 11 — joins Commissioner Kuderer to talk about Senate Bill 5589, which the OIC requested and Hasegawa sponsored.

Listen to the episode — https://bit.ly/43QGwW3

SB 5589 asks the OIC to conduct a study on how insurance companies use credit history, credit-based insurance scores and other rate factors that may have disparate impacts on Washington residents. The study would also explore alternatives to credit scoring that companies could use in determining premiums.

Commissioner Kuderer and Senator Hasegawa cover why the bill matters, what it entails, where funding for the study comes from, how the insurance industry feels about the bill and where it’s at in the legislative process.

Washington — Office of the Commissioner: Why did Sen. Adrian Cortes sponsor Senate Bill 5331? OIC Answers has moved to the Capitol for the time being, setting up the mics and mixing board in the Insurance Building for a few legislative session-inspired episodes.

In this episode, Senator Adrian Cortes (D-Battle Ground) joins Insurance Commissioner Patty Kuderer to discuss Senate Bill 5331 (“Strengthening consumer protection through increased insurer accountability for violations of the insurance code.”)

Learn more on our website or on our previous episode introducing the bill — https://bit.ly/3Y12cem