California Bill will Require Insurers to Insure Homes

A bill has been introduced in the California Legislature that will — if passed — require insurers to sell homeowners insurance to a homeowner who has hardened their home against wildfire.

The insurer will have no choice in the matter.

That’s the goal of Assemblyman Mark Levine. He’s a Democrat from Marin County and his purpose is to harden residential properties located in areas prone to wildfire. If his bill — AB 1755 passes — an insurer will have to insure a property if science-based actions have been taken “to harden their property from wildfire risk.”

The bill will also set up a Wildfire Protection Grant Program that the California Department of Insurance will administer. It will give grants of up to $10,000 to residential property owners that will pay for the cost of hardening their home against wildfire.

The assemblyman says this will address the huge number of homeowners insurance policy cancelations in California. “It is time to stand up for California homeowners and tell insurance companies to stop exploiting the climate crisis for profit,” Levine said. “We have seen an unprecedented number of families across California lose their homeowners’ insurance at a time they need this protection the most. For families that do the right thing and take action to reduce their home’s risk to wildfire loss, there is no reason to deny them insurance coverage.”

Levine said this will force insurers to do their part to protect homeowners.

As you would expect, the idea isn’t going to be all that favorable to insurers. Mark Sektnan of the American Property Casualty Insurance Association (APCIA) said his group opposes any bill that mandates that insurers insure a property without adequate rates and proof that risk has been reduced.

“The bill also ignores the need for community hardening efforts,” he said. “In the absence of community hardening, home hardening can be far less effective. Embers travel miles, igniting homes randomly. We must have a comprehensive community and individual mitigation effort along with a verifiable risk reduction process.”

AB 1755 will be considered this Spring and if passed will go into effect in 2025.

Source link: Insurance Journal — https://bit.ly/3JcYsg1