Daily California P&C Insurance News

Senate Bill 876, introduced by Insurance Commissioner Ricardo Lara and Senate Insurance Committee Chair Steve Padilla, mandates disaster recovery plans from insurers to speed up claims during emergencies and doubles penalties for violations.[1] It also expands policy limits for living expenses, requires upfront payments for total losses, and offers extended replacement cost coverage to aid wildfire survivors.[1]

Southern California’s wet November raises concerns about flooding and mudslides, potentially driving reinsurance costs and leading to higher home insurance premiums despite possible global reinsurance softening in 2026.[2] Homeowners in high-risk wildfire and flood areas face continued rate hikes, stricter underwriting, and more non-renewals as insurers align premiums with catastrophe risks.[2]

A new suite of laws effective January 1 requires insurers to pay up to 60% of contents coverage limits, capped at $350,000, upfront for homes lost in qualifying disasters.[3] These measures promote wildfire safety, enhance consumer protections, and increase transparency amid rising climate-driven insurance challenges.[3]

One year after the January 2025 L.A. wildfires destroyed over 12,000 homes, survivors’ complaints about delayed and underpaid claims have spurred new bills, including requirements for insurers’ disaster recovery plans reviewed by the Department of Insurance.[5] A new law also allows fire victims up to $350,000 upfront for personal property without itemization.[5]

Fitch Ratings anticipates U.S. P&C premium growth slowing to 3-4% in 2026 with normalized hurricane activity, but California wildfires contributed $40 billion in losses last year.[4] Ample reinsurance capacity will soften rates, benefiting primary insurers, while rate hikes and underwriting improvements support homeowners profitability.[4]