After a summer that saw many of California’s top home insurers pull back from the state market, Insurance Commissioner Ricardo Lara announced that he struck a deal with the insurance industry to encourage new coverage.
A house burns on Platina Road at the Zogg Fire near Ono, Calif., on Sept. 27, 2020. , Insurance Commissioner Ricardo Lara announced Thursday that he struck a deal with the insurance industry to encourage new coverage in the state.
Since the massive fire years of 2017 and 2018, home insurers have been gradually withdrawing from the most fire-prone parts of the state. As a last resort, homeowners and businesses in those areas have turned to California’s FAIR plan, a backstop insurance provider funded by the companies that do business in the state, which charges much higher rates to provide less coverage in high-risk areas.
This system was created in 1988, when California voters approved Proposition 103, and the first elected commissioner on the job, current congressman John Garamendi , put a regulatory regimen in place above and beyond the text of the ballot measure.
Lara also said he aims to speed up the overall process by accelerating the pace of rate approvals, and that the new state budget includes funds for hiring more staff to process filings. He will also require that intervenor filings be made public, which Lara argues will increase transparency and make it easier for more consumer advocates to participate.
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