Daily Property & Casualty Insurance News

Senate Bill 876, the Disaster Recovery Reform Act, requires insurers to submit disaster recovery plans for claims handling and doubles penalties for violations during emergencies. The bill also expands policy limits for additional living expenses by 100% and mandates up-front payments for total losses to speed homeowner recovery after wildfires.

A suite of new laws effective January 1 requires insurers to pay 60% of contents coverage limits, up to $350,000, without itemization for homes lost in qualifying disasters. These measures aim to enhance wildfire safety, consumer protections, and transparency amid rising climate-driven insurance challenges.

Lawmakers have pressed major insurers like State Farm and the FAIR Plan on excessive itemization demands and multiple adjusters slowing fire victim claims. A new law mandates up to 60% of personal property coverage upfront without detailed inventories, while regulators launch exams into claims handling practices.

The California FAIR Plan is targeting $200 million in fully collateralized reinsurance via its second Golden Bear Re 2026-2 catastrophe bond for wildfire losses. This three-year deal covers part of a billion-dollar layer from $6-7 billion, supporting the insurer of last resort’s extensive property exposure.

California’s workers’ compensation sector shows stress with the insurance commissioner approving a 9% rate increase amid rising claims costs eroding profits. Nationally, workers’ comp remains a bright spot with 12 years of favorable combined ratios, contrasting hardening casualty lines.