"As insurance companies continue to hike rates and cancel coverage for thousands of homeowners across fire-prone parts of California, Gov. Gavin Newsom is directing regulators to come up with new solutions to stabilize the state's spiraling home insurance market. In an executive order this week, Newsom instructed the state insurance department to submit recommendations on insurance costs and accessibility, wildfire mitigation and compensation for fire victims, among other concerns."
"There's no Republican or Democrat thermometer red and blue states alike, and countries around the world, are facing this climate-fueled insurance crisis, said Newsom, a likely 2028 presidential contender, in a statement. And California is taking action. The order is tied to a new law authored by California Sen. Josh Becker, a Silicon Valley Democrat, that requires state officials to publish a report by April 2026 on strategies for responding to catastrophic wildfires, such as the deadly blazes in Los Angeles early this year."
"Newsom's order instructs the insurance department, along with four other state agencies responsible for forests, utilities, energy infrastructure and emergency response, to contribute recommendations to the report. The directive comes as state regulators phase in reforms aimed at enticing insurers to cover more fire-risk homes. In exchange for writing additional policies, the state will now permit insurers to raise rates based on the growing threat of climate change."
"Some consumer advocates, however, contend the new rules will lead to soaring rate hikes without a meaningful expansion of coverage. Even as insurance companies have repeatedly won approval to increase rates in recent years, the industry argues the changes are necessary to continue doing business in California's tightly regulated insurance market. Despite the wildfire risk, the state's average price for home insurance coverage ranks in the middle of the pack nationwide, at $1,632 a year, according to Bankr"
Insurance companies are hiking rates and canceling coverage for thousands of homeowners in California's fire-prone areas. Gov. Gavin Newsom ordered state regulators to propose recommendations on insurance costs, accessibility, wildfire mitigation, and compensation for victims. The directive requires contributions from agencies overseeing forests, utilities, energy infrastructure, and emergency response, and ties to a law mandating a report by April 2026 on catastrophic wildfire responses. Regulators are phasing reforms to encourage insurers to cover more fire-risk homes while allowing climate-linked rate increases. Consumer advocates warn that rate hikes may outpace meaningful coverage expansion, despite average premiums near the national middle.
Read at www.mercurynews.com
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