Daily P&C Insurance News

The Make It FAIR Act overhauls the FAIR Plan by strengthening claims handling, expanding coverage options like comprehensive homeowners policies, and improving transparency for wildfire survivors. This legislation addresses failures identified in a recent Department of Insurance examination regarding financial condition, governance, and consumer protections.

Senate Bill 876, the Disaster Recovery Reform Act, mandates insurers to create disaster recovery plans for claims handling during emergencies and doubles penalties for violations. It also expands policy limits for living expenses, requires quicker up-front payments for total losses, and offers extended replacement cost coverage.

New laws effective January 1 promote wildfire safety and consumer protections, including the Eliminate “The List” Act that pays 60% of contents coverage limits up to $350,000 without requiring detailed inventories from disaster survivors. The Business Insurance Protection Act extends non-renewal protections to businesses, HOAs, condos, and nonprofits.

Insurance Commissioner Ricardo Lara approved a 6.9% rate increase for Mercury Insurance and CSAA over the holidays, with hikes for Farmers and the FAIR Plan pending. Following last year’s Los Angeles fires, State Farm received approval for a 17% increase, highlighting ongoing challenges in California’s property insurance market.

California’s insurance commissioner approved a 9% increase in workers’ compensation rates amid rising claims costs pressuring insurer profits. While the national workers’ comp sector benefits from falling claims frequency, stress appears in California’s market.