California Insurance Commissioner Ricardo Lara ordered insurers to maintain residential property coverage for more than 14,800 policyholders affected by the Pack Fire, following Gov. Gavin Newsom’s emergency declaration on Dec. 9.
The order, issued through a commissioner’s bulletin, bars insurers from canceling or refusing to renew policies for 1 year from the date of the governor’s declaration for homeowners living within the wildfire’s perimeter or in adjoining ZIP Codes, whether or not they reported a loss.
“I am acting to protect Sierra foothill residents who have already been through a lot. Nobody should worry about losing their insurance coverage after going through a wildfire emergency,” Lara said.
Lara also said, “This protection is needed now as we bring back insurance options to all parts of our state for those who need them the most.”
The department tied the action to Lara’s Sustainable Insurance Strategy, under which six insurance companies have said they plan to remain in, or expand within, parts of California affected by wildfires. The insurers cited were Farmers, Mercury, CSAA, USAA, Pacific Specialty and California Casualty.
As Lara’s office points to insurer participation under that strategy, Farmers has separately said it is removing the cap on new homeowners insurance policies in California, also framing the change as aligned with the Sustainable Insurance Strategy.
The department said four of the insurers on that list are among the state’s top homeowners carriers. It did not provide additional details on how each company’s participation would be measured.
Lara’s authority to impose the moratorium stems from a California law he authored in 2018 while serving as a state senator, according to the department. The law allows temporary relief from residential insurance non-renewals and cancellations for residents in or near areas covered by a gubernatorial-declared wildfire disaster.
Since 2019, Lara’s actions under the moratorium law have protected more than 4 million homeowners, the department said.
The department advised consumers who were non-renewed before the emergency declaration date and cannot find coverage, or who are dissatisfied with their current coverage, to contact the California Department of Insurance for help reviewing available options and tools.
The bulletin also arrives during continued debate over availability and pricing in wildfire-exposed areas, including activity at the California FAIR Plan. The FAIR Plan has filed for a 35.8% request that would, if approved, mark its first rate application using wildfire catastrophe models and reinsurance costs.
