AB 2167 + SB 292 – Insurance Market Action Plan

PIFC supported AB 2167 (Daly), which passed to the Senate, and SB 292 (Rubio), which is pending in Assembly Governmental Organization Committee. These bills must be enacted jointly to become operative. Together they provide a comprehensive framework to increase the availability of admitted market insurance in high fire-threat areas and help reduce risk and loss through individual home hardening and community-wide wildfire mitigation.  

Major provisions of these bills:  

  • Establish the Insurance Market Action Plan (IMAP) program and authorize an insurer to submit an IMAP filing, which would be subject to approval by the Department of Insurance.  
  • Require, as part of an IMAP filing, an insurer to commit to offer new and renewal residential property insurance policies in counties with high fire-threat areas, as specified, until the insurer achieves a market share in those IMAP counties that is at least 85% of its statewide market share.  
  • Require an IMAP to include community and parcel-level mitigation standards, procedures for verifying mitigation activities, a request for adequate rates, and a plan for maintaining solvency of the insurer (i.e., the ability to pay claims in the event of a disaster).  
  • Allow an IMAP filing to utilize complex catastrophe models that consider both parcel-level and regional mitigation.  
  • Provide a framework for a new state commission, with a broad group of stakeholders, which will develop home and community hardening standards that can reduce loss due to wildfires and establish a central database on housing infrastructure specific to wildfire risk. 
  • Create a Catastrophic Modeling Advisory Committee that will develop a plan for a public catastrophic wildfire loss model, strategies for review of third-party models, and support the use of probabilistic loss modeling in IMAP rate filings.  
  • Require the state’s Office of Planning and Research to issue an accountability report that analyzes the effectiveness of the IMAP program at providing more robust coverage at lower cost than the California Fair Access to Insurance Requirements (FAIR) plan, and monitors the insurers’ progress on their commitment to offer homeowners insurance policies in wildfire-prone communities. 

AB 2167 moved smoothly through the Assembly Insurance Committee, Assembly Appropriations Committee, and off the Assembly floor despite opposition from the California Department of Insurance.  

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