New Bill Requires Insurance Companies to Offer and Renew Insurance Coverage for Fire-Safe Homes
Sacramento, CA – New legislation introduced by Senator Sasha Renée Pérez – the Insurance Coverage for Fire-Safe Homes Act, SB 1076 – will ensure homeowners who make their homes fire-safe can obtain and keep home insurance. The bill is co-sponsored by the Eaton Fire Survivors Network and Consumer Watchdog.
The bill responds to wildfire survivors’ concerns that they could lose home insurance coverage after they rebuild, even if they meet the highest wildfire safety standards. SB 1076 requires insurance companies to offer homeowners insurance to Californians who meet state home hardening and defensible space requirements set by the insurance commissioner.
Californians who have not experienced a wildfire face the same uncertainty, said the groups. Enrollment in the insurer of last resort, the FAIR Plan, has doubled in just two years and hundreds of thousands of homeowners across California have lost their insurance coverage.
SB 1076 provides the assurance communities need to rebuild and make existing neighborhoods safer.
“To help fire survivors return home, we need assurance that newly built, wildfire resilient homes will receive insurance coverage. Homeowners who meet or exceed safety standards should not be met with coverage denials,” said Senator Sasha Renée Pérez (D-Pasadena). “I’ve spoken with Eaton Fire survivors whose newly built homes will meet the highest levels of protection against wildfires but still fear they won’t be able to purchase insurance. Being denied coverage after meeting safety standards sends the wrong message and is akin to being penalized for doing the right thing. SB 1076 will ensure that our communities’ insurance needs are met by making coverage available to them for making existing neighborhoods safer.”
“Wildfire safety measures can reduce communities’ fire risk by half, yet too often these steps are ignored when insurance companies decide who to cover. It’s outrageous that insurance companies have cancelled thousands for fire risk, but refuse to take them back when they reduce that risk. Homeowners deserve to know that when they invest in wildfire protection they will be able to insure it. That’s how we stem the insurance crisis and make all California communities safer,” said Carmen Balber, executive director of Consumer Watchdog.
Joy Chen, executive director of the Eaton Fire Survivors Network, said, “Survivors are rebuilding stronger and safer. But if our community cannot access insurance even after making our homes fire-safe, our housing market will crater. SB 1076 protects both consumers and insurers.”
Eighty-five percent of voters surveyed in two separate polls by Hart Research and FM3 Research believe that home insurers should be required to cover homeowners who meet state fire safety guidelines.
Insurance companies dropped twice as many policies in wildfire distressed areas since 2023 than they have committed to sell by 2028 under the Sustainable Insurance Strategy, so we need to do more to keep Californians insured, said Consumer Watchdog.
California already has a similar fairness model in the auto insurance market. Existing state law enacted by the voters in Proposition 103 requires insurers to offer and sell a Good Driver Discount policy to any driver who meets the state’s good driver standard. Supporters say fire-safe homes deserve the same protection.
The legislation would:
- Require insurance companies to offer and renew insurance coverage for any home that meets wildfire-safety standards adopted by the insurance commissioner, including home hardening measures and defensible-space requirements
- Allow the Commissioner to impose a five-year bar from both home and auto markets for insurers that refuse to comply.
Studies from the National Association of Insurance Commissioners, CalFire, and the University of California Berkeley, provide three examples of the broad scientific agreement that wildfire mitigation – in the form of home-hardening and defensible space – significantly reduces the risk of structural damage from a catastrophic fire.
Consumer Watchdog is supporting or co-sponsoring several other bills addressing home insurance claims, access and affordability this year.
SB 877 (Pérez), cosponsored by Consumer Watchdog and the Eaton Fire Survivors Network, helps consumers challenge claim underpayments by requiring insurers to disclose all original loss estimates and all revisions so homeowners can see how their payout was calculated, what changes were made, and why.
SB 878 (Pérez), cosponsored by Consumer Watchdog and the Eaton Fire Survivors Network, strengthens existing laws on claim delays by imposing a 20% interest penalty when insurers don’t make payments on time and eliminating insurers’ incentive to stay silent on portions of a claim.
SB 982 (Wiener), the Affordable Insurance and Recovery Act, would help make home insurance affordable and available in California. It would allow the Attorney General to take large oil and gas corporations to court to hold them accountable and return funds to Californians, who are currently bearing these costs through high insurance premiums.
AB 1642 (Harabedian) would establish statewide science-based standards for post-fire home testing and clearance. 70% of survivors whose homes have been tested have found contaminants above acceptable levels yet the largest hurdle to completing remediation is that insurance will not cover it, according to a Department of Angels survey.
