Wednesday , July 24 2024
Board of Supervisors urges state to declare an insurance emergency

Board of Supervisors urges state to declare an insurance emergency

The San Bernardino County Board of Supervisors are urging California to declare a state of emergency and take immediate emergency regulatory and legislative action to strengthen and stabilize the state’s marketplace for homeowners insurance and commercial property insurance.

In recent months, two of the state’s largest insurance carriers announced they would stop issuing new homeowners and commercial property insurance policies in California and several other carriers plan to limit new policy origination. This reduction in insurance options means homeowners, business owners, and farmers are now unable to obtain new insurance policies.

“The reduction of insurance options in the state has had a direct negative impact on our consumers’ ability to get coverage and it’s putting our homeowners and businesses at risk of catastrophic loss,” said Board of Supervisors Chairman and Third District Supervisor Dawn Rowe.

Californians who cannot obtain coverage are forced to apply for protection through the California Fair Access to Insurance Requirements (FAIR) Plan, a state-established risk pool intended to operate as California’s insurer of last resort providing temporary coverage as consumers pursue insurance in the traditional market. The collapsing market has caused steadily increasing enrollment in the FAIR Plan over the past five years, threatening the ongoing stability of the plan, putting even this safety net at dire risk.

California Insurance Commissioner Ricardo Lara introduced a new regulation earlier this year to let insurances use catastrophe modeling. He also unveiled a regulation designed to speed up the Insurance Commission’s review of proposed premiums.

But the county says those reforms won’t take effect soon enough — not until at least 2026 and it may take a few years after that for the market to react … this timeline, of course could be delayed further if lawsuits by any party, including insurers or consumers, were to occur.

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