California lawmakers are weighing legislation that would set the country's first formal standards for handling smoke damage to homes, a move that could reshape wildfire-related claims and remediation practices for property insurers in the state.
Assembly Bill 1795, backed by Insurance Commissioner Ricardo Lara (pictured), would establish science-based rules for inspecting, testing and restoring smoke-damaged properties, according to the California Department of Insurance (CDI).
According to a report from BestWire, the bill would also define uniform claims practices, set guidelines for when it is considered safe for residents to return to a property, and identify which state and local agencies will implement and enforce the standards.
The proposal comes as insurers, regulators and homeowners continue to grapple with long‑tail smoke and soot damage from increasingly frequent and severe wildfires.
Under AB 1795, state agencies would be tasked with creating clear protocols for assessing indoor smoke contamination and determining when remediation is adequate. While specific thresholds are still to be determined, CDI said the rules are expected to draw on public health benchmarks for particulate matter, surface contamination and air quality, and to spell out acceptable testing and cleaning methods.
The bill would also allow wildfire victims to rely on locally established health standards for smoke testing and restoration immediately, while statewide rules are being finalized. Lara said that interim provision is critical because smoke damage is both an insurance and public health issue.
“Policyholders are being told to return to homes coated in toxic residue, and they cannot wait for the long rulemaking process to play out,” Lara said in a statement. “They need clear standards and real protection now. We are delivering immediate relief for Los Angeles survivors while building the long-term, science-based framework Californians deserve. After more than 30 years without enforceable standards, it falls to us to lead.”
The bill builds on the work of a smoke damage task force convened in May 2025 to explore standards for smoke‑related claims. Its recommendations, along with other scientific and health data, are expected to inform the final statewide framework.
More prescriptive smoke damage standards could raise the cost and scope of remediation following major wildfires. Requirements to test and, in some cases, replace HVAC systems, insulation, soft furnishings and building materials, as well as to meet defined clearance levels before reoccupancy, would likely increase average severity on partial-loss claims.
At the same time, insurers could see fewer disputes over what constitutes adequate cleaning and “safe” re-entry, if the rules provide clear, enforceable thresholds. Carriers may need to revisit homeowners policy language around fire and smoke damage, contamination, and “direct physical loss,” as well as adjust reserving assumptions and vendor arrangements for environmental testing and restoration.
Industry groups are expected to examine how far the standards go in defining mandatory testing and remediation, and whether they align with available contractor capacity and homeowners’ coverage. An attempt to obtain comment from the Personal Insurance Federation of California was unsuccessful.
If enacted, AB 1795 would require adjusters and claims staff to follow more defined protocols for smoke assessments and remediation approvals, and could increase the role of indoor environmental professionals and public health officials in loss adjustment. Restoration vendors may face new certification or reporting expectations tied to the standards.
Because AB 1795 would create the first statewide framework of its kind, regulators and litigators in other wildfire‑exposed states are expected to watch closely. California’s approach could become a reference point for future smoke damage standards elsewhere in the West and in jurisdictions facing large urban or industrial fire events.
The bill will now move through the committee process in Sacramento, where lawmakers will hear from consumer advocates, health officials, insurers and restoration industry representatives before deciding whether to advance the measure, according to the report.
The move comes amid broader strain in California’s homeowners' market, where several major carriers have restricted new business or adjusted underwriting in high‑risk areas, citing wildfire exposure, reinsurance costs and regulatory constraints on rate adequacy. Clearer smoke damage standards could resolve some friction in claims handling, but may also be viewed as another regulatory layer in an already challenging operating environment.
