By Laurence Darmiento, LOS ANGELES TIMES
Gov. Gavin Newsom has signed wildfire insurance reforms, but vetoed bills cracking down on claims-handling practices that drew complaints from January 2025 fire victims.
Over the weekend, Newsom signed the Disaster Recovery Reform Act by Sen. Steve Padilla, (D-San Diego), sponsored by Insurance Commissioner Ricardo Lara, as well as a bill by Sen. Benjamin Allen, (D-Santa Monica), which tightens regulations governing nonrenewals of policies.
Padilla’s legislation, Senate Bill 876 (opens in new tab), will double penalties during a declared emergency for violations of fair claims practices, require insurers to pay restitution directly to policyholders when they engage in unfair settlement practices and mandate timely status reports whenever an insurer changes adjusters, amid other provisions.
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Carmen Balber, executive director of Consumer Watchdog, a Los Angeles advocacy group that co-sponsored both bills, disputed Newsom’s reasoning (opens in new tab).
She said there is nothing in the state’s insurance code that requires insurers to provide policyholders with revised loss estimates, while existing regulations requiring interest penalties for late payments are toothless.
“L.A. fire survivors experience shows that insurance companies don’t have to deny your claims payments. They only have to delay them,” she said.
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