Overall, this was a strong year for defensive efforts. In 2018, the insurance industry withstood over a dozen “wildfire” bill proposals focused on homeowners insurance. As expected in 2019, many legislators wished to continue skirmishing. After putting down early scares in the Assembly and Senate, the 2019 legislative session ended with some acceptable, incremental reform.
Fortunately, none of the far-reaching proposals from the Governor’s Strike Team report, the SB 901 Commission report or the Insurance Commissioner’s last-minute “wish list” of insurance reforms were enacted into law. However, with the growing number of non-renewals and the scarcity of carriers accepting new business in high-fire risk communities, we should expect challenges in 2020. PIFC staff is working with member companies to consider how insurers can be a productive voice during the upcoming discussions about revitalizing the admitted market for new business in high fire risk areas.
Ending the acrimony with investor owned utilities (IOUs) was a terrific accomplishment. After the high-stakes fight about inverse condemnation in the 2018 session, this year’s work to create an excess liability fund for IOU-caused fires was a good policy solution. Avoiding a surcharge on homeowners’ insurance policies to capitalize the fund was not easy.