Daily P&C Insurance News
California Edition

Assembly Bill 1680, the Make It FAIR Act, aims to reform the California FAIR Plan by improving customer service, claims handling, and transparency following findings of systemic issues after the 2025 Los Angeles wildfires. The bill requires comprehensive homeowners coverage options, more staff hiring, and better clearinghouse programs to transition policyholders back to the regular market.

The California FAIR Plan is targeting $200 million in fully collateralized reinsurance through its second Golden Bear Re 2026-2 catastrophe bond to protect against California wildfire losses on a three-year term ending February 2029. This builds on its 2025 reinsurance tower amid growing wildfire exposure across the state.

Sen. Adam Schiff and 15 congressional allies are demanding explanations from nine insurers, including State Farm and the FAIR Plan, on itemized receipt requirements delaying payouts to 2025 wildfire victims whose records were destroyed. The letter questions potential violations of state insurance code amid ongoing complaints and regulatory exams into claims handling.

California Insurance Commissioner Ricardo Lara proposes new rules allowing insurers to factor future climate risks into property rates if they commit to writing more policies in high-risk wildfire areas. This addresses market withdrawal by top insurers due to restrictive past-loss-only pricing amid rising catastrophic losses from climate change.

The California FAIR Plan confronts a challenging end-February reinsurance renewal for $3.46 billion after a poorly filled $7.1 billion tower, driven by significant increases in wildfire exposure. Capacity constraints and rising risks are pushing renewal costs higher for the residual market insurer.