Proposed Regulation Aims to Expand Insurance Coverage in High Wildfire Risk Areas

On June 12, the California Department of Insurance announced a new draft regulation to get more insurance coverage options for Californians in areas particularly threatened by wildfires. This new regulation will require that insurers that use new catastrophe modeling must write more policies in distressed areas, with larger insurance companies required to insure properties in distressed areas at a rate equal to 85% of the insurer’s statewide market share. Governor Newsom provided his support for the regulation, which is part of the Sustainable Insurance Strategy, a package of reforms to strengthen California’s marketplace and maintain strong consumer protections.