Ben Allen and Jane Kim are running to be the state’s next insurance commissioner. Both promise change, but not along the same lines.
By Leslie Kaufman and Michelle Ma, BLOOMBERG
As high temperatures bake California and strong winds make it more susceptible to fire (opens in new tab), voters in the state are being wooed by political candidates with divergent visions for how to protect homes from stepped-up climate risks.
California has the nation’s largest home insurance market, according to McKinsey & Co., worth $15 billion (opens in new tab). Jane Kim argues that the market has failed and the state should assume responsibility for the costliest climate disasters. Ben Allen says the private market can still work if regulators strengthen consumer protections and create incentives for homeowners and communities to reduce wildfire risk.
Those competing philosophies are facing off in California’s race for insurance commissioner, after Kim and Allen emerged from an 11-candidate primary to advance to the November election.
The clash between the two Democrats wouldn’t typically be a marquee race. But this election comes with higher stakes, now that insurance is one of California’s most pressing affordability issues. Even before the devastating 2025 Los Angeles fires (opens in new tab), insurers had withdrawn from parts of the state, non-renewals of policies were widespread and premiums had increased steeply. The LA fires then left thousands of homeowners confronting the question of whether they had adequate coverage (opens in new tab) — or any coverage at all.
Read More: The LA Fire Recovery Nightmare (opens in new tab)
California may be the epicenter of the insurance meltdown, but it is hardly alone. Homeowners around the country are facing rising rates as climate-driven disasters become more frequent and expensive, turning what was once a niche regulatory issue into a broader political one.
“Home affordability is a central issue in many elections,” said Benjamin Collier, a University of Wisconsin at Madison economist. “Rising premiums are bringing insurance into that discussion.”
California’s Senator Adam Schiff, a Democrat, last year introduced legislation (opens in new tab) in Congress that would create a federally backed catastrophe reinsurance program, which would help absorb the largest disaster losses borne by private insurance companies. (Collier and academic colleagues have suggested (opens in new tab) a similar measure.)
But barring a new national law, states will have to figure out their own solutions. Because California has often served as a proving ground for insurance regulation, the outcome of the commissioner race could resonate well beyond its borders.
Kim is a former San Francisco supervisor who served as California political director for Senator Bernie Sanders, a Vermont independent, during his 2020 presidential campaign and who later led the California Working Families Party. She sees the insurance crisis as part of a broader affordability challenge that demands a larger role for government. Climate change has fundamentally broken the home insurance market, she argues, and incremental reforms are no longer enough.
“The private insurance market is not designed to address climate disaster,” Kim said in an interview with Bloomberg News.
Her proposal would have private insurers continue to sell policies but would create a state-run program to cover catastrophic wildfire and disaster risk through a levy on premiums. The state would invest part of the money raised from the levy in wildfire prevention and climate resilience, to reduce future losses.
Kim said she hasn’t estimated how much the proposal would cost or exactly how it would be capitalized, saying those details would have to be worked out with the legislature if she is elected.
Allen is a state senator whose coastal LA district includes the Pacific Palisades, one of the communities devastated by last year’s wildfires. He said his office helped hundreds of constituents secure payouts after the fires, leaving him frustrated that people who faithfully paid premiums would struggle to collect when disaster struck.
“Why do you have to go to your state senator just to be treated properly by a system you’ve been paying into for years and years?” he said in an interview. The system needs reform, he argues, but not replacement.
Allen said Kim’s proposal would expose taxpayers to potentially enormous liabilities while offering few practical answers about financing or implementation. Instead, he wants to create what he calls a “virtuous cycle” in which homeowners and local governments invest in home hardening, defensible space and other wildfire mitigation steps while insurers commit to meaningful premium discounts and broader coverage in return. Part of what the next insurance commissioner needs to do, in his view, is to make sure that insurers will reward mitigation with lower premiums.
Read More: While Los Angeles Burned, Rules to Protect Homes From Wildfires Were On Hold (opens in new tab)
Kim says the plan wouldn’t work because homeowners wouldn’t be incentivized to make capital-intensive improvements to harden their homes (opens in new tab) just to save a much smaller amount on their insurance bills. By Allen’s own estimates, such wildfire mitigation measures could cost upwards of $50,000 to $60,000 per home.
A California law, Proposition 103, requires regulatory approval of most property and casualty insurance rate hikes and gives consumer groups the right to challenge them. Allen wants to speed the rate reviews. He also wants to expand fraud enforcement, increase transparency around handling of claims and create a public scorecard grading insurers on their post-disaster performance. He said he doesn’t rule out targeted state interventions in the market, including providing reinsurance, but California should focus on reducing risk.
Consumer Watchdog, an advocacy group whose founder drafted Proposition 103 in the 1980s, has reservations about both Allen’s and Kim’s approaches. Kim’s would require tens of billions of dollars in capital and is unlikely to be politically feasible, it says, while Allen needs to take a tougher line against insurers and require them to cover homeowners who meet state wildfire-mitigation standards.
“Jane could be a little more realistic. Ben could be a little tougher,” said Jamie Court, the group’s president.
What Allen and Kim agree on is that the current system is untenable. Since the LA fires, affected homeowners have continued to report unfair delays and denials from insurance companies, and more are being dumped every day on the state’s home insurer of last resort (opens in new tab), the FAIR Plan, threatening its solvency.
As climate-related risks rise, regulators and lawmakers are grappling with how to distribute the additional costs most equitably among homeowners, insurers and taxpayers.
So far, Allen has raised significantly more money than his rival. But the results of the June 2 primary suggest that some Californians, unhappy with the status quo, may be willing to try out untested ideas: Kim led Allen by 8 percentage points (opens in new tab).
“Honestly, we’re already paying for disaster. We’re paying for it in the form of FEMA dollars, state and county dollars,” said Kim, in response to criticisms that her plan would be too costly. “The current system is too expensive and it doesn’t work.”
