Daily Property & Casualty Insurance News

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

California home insurance premiums are projected to rise 20% or more by end of 2025 due to reinsurance costs, wildfires, and recent wet weather increasing flood risks in Southern California. Regulatory changes now allow forward-looking catastrophe models, potentially leading to higher rates in high-risk areas but more carrier participation long-term.

The California Department of Insurance released its 2026 guide outlining key laws for adjusters handling property claims post-disaster, including advance payments for living expenses and grace periods for premiums. It details requirements for total loss payouts, building code upgrades, and combining coverages up to policy limits during states of emergency.

A suite of new laws effective January 1, 2026, mandates insurers pay 60% of contents coverage limits up to $350,000 for total home losses in qualifying disasters. The legislation enhances wildfire safety, consumer protections, transparency, and convenience amid rising climate-driven insurance challenges.

California Insurance Commissioner Ricardo Lara approved a 6.9% rate hike for Mercury Insurance and CSAA over the holidays amid ongoing market strains. Critics argue private insurers are exacerbating access issues for homeowners in high-risk areas.