California, September 23, 2025
News Summary
A new proposal by Consumer Watchdog seeks to enhance protections for California homeowners against insurance policy cancellations due to wildfire risks. The initiative, known as the Insurance Policyholder Bill of Rights, mandates coverage for homeowners who fireproof their properties and introduces penalties for insurers who fail to comply. Currently facing two lawsuits, this proposal aims to bolster security for homeowners concerned about insurance reliability amidst increasing wildfire risks.
California homeowners may soon have enhanced protections against insurance policy cancellations due to wildfire risks, thanks to a new proposal put forth by consumer advocacy group Consumer Watchdog. The proposed Insurance Policyholder Bill of Rights aims to ensure that homeowners who take measures to fireproof their properties are entitled to coverage from their insurers. This initiative was formally submitted to state Attorney General Rob Bonta’s office last week and seeks a spot on the November 2026 ballot.
Under the new initiative, insurers would be required to provide coverage to homeowners who make fireproofing improvements to their properties. In the event insurers fail to comply with this requirement, they would risk losing their rights to sell home or auto insurance in California for a period of five years. Additionally, homeowners who find themselves dropped by their insurers will be granted a 180-day period to address necessary home repairs and improvements.
The proposal is a direct response to the concerning trend of insurers canceling policies after claims related to wildfire damage are filed. Harvey Rosenfield, founder of Consumer Watchdog and author of Proposition 103, believes this initiative aims to secure coverage for those investing in wildfire mitigation. The initiative was introduced amidst a backdrop of growing frustration from homeowners over policies being rescinded.
Two lawsuits are currently active in Los Angeles County Superior Court against California home insurers accused of unilaterally dropping policyholders and shifting them onto the state’s FAIR Plan. The FAIR Plan functions as California’s insurer of last resort, but it is known to offer coverage at higher costs and with limited benefits.
If adopted, the proposed initiative would allow insurers to apply for six-month waivers from the coverage requirement in specific areas where they can demonstrate an overconcentration of risk. This proposal comes in light of years of insurance companies retreating from the California market, influenced by rampant wildfires and the pursuit of increased insurance premiums.
While the initiative aims to bolster protections for homeowners, it also faces significant uncertainties. Carmen Balber, executive director of Consumer Watchdog, indicated there is no guarantee that the group will successfully gather the necessary 500,000 signatures required to qualify for the ballot. Moreover, the initiative has been prompted by a competing proposal from insurance broker Elizabeth Hammack, which seeks to overturn key elements of Proposition 103. Hammack’s proposal would enable insurers to raise rates without prior authorization from the insurance commissioner and mandates that the commissioner have a minimum of five years of insurance experience.
Complaints surrounding California’s home insurance market have been prevalent, especially following the January 7 fires that resulted in considerable losses for many homeowners. Frustrations have predominantly centered around the claims processes utilized by major insurance companies, such as State Farm, California’s largest home insurer. Governor Gavin Newsom has also urged the FAIR Plan to expedite and fairly manage smoke damage claims stemming from the recent fires. Compounding the situation, the California Department of Insurance has recently initiated legal actions regarding claims denials for smoke damage related to the state’s insurer of last resort.
Public anger continues to escalate over the treatment of claims by insurers following the tragic January fire storms, which led to over 30 fatalities. With the proposed Bill of Rights, Consumer Watchdog aims to restore a sense of security for homeowners concerned about wildfire risks and the reliability of their insurance coverage.
Frequently Asked Questions (FAQ)
What is the Insurance Policyholder Bill of Rights?
The initiative proposed by Consumer Watchdog requires insurers to offer coverage to California homeowners who fireproof their homes.
What happens to insurers if they do not comply with the initiative?
If insurers fail to comply, they would lose the right to sell home or auto insurance in California for five years.
How long do policyholders have to make necessary repairs if their insurance is not renewed?
Policyholders not renewed by their insurers would be granted 180 days to make necessary home repairs and improvements.
Why was the Initiative proposed?
The proposal aims to mitigate coverage cancellations due to filing claims related to wildfire damages.
What legal actions are currently ongoing regarding California home insurers?
Two lawsuits have been filed in Los Angeles County Superior Court against California home insurers for dropping policyholders and forcing them onto the state’s FAIR Plan.
Key Features of the Insurance Policyholder Bill of Rights
| Feature | Details |
|---|---|
| Fireproofing Coverage | Insurers must offer coverage to homeowners who fireproof their homes. |
| Consequences for Non-compliance | Insurers who do not comply lose the right to sell home or auto insurance for five years. |
| Repair Period | Policyholders dropped by insurers have 180 days to make necessary repairs. |
| Reason for Proposal | Aim to reduce cancellations following wildfire damage claims. |
| Lawsuits | Two lawsuits against insurers for dropping policyholders into the FAIR Plan. |
Deeper Dive: News & Info About This Topic
- Los Angeles Times: Insurance Rights Initiative Proposed
- US News: California Homeowners Insurance
- New York Times: LA Fire Home Insurance Legislation
- LAist: Ballot Initiative on California Insurance
- Daily Journal: Emergency Property Insurance Rules
- Wikipedia: Insurance
- Google Search: California wildfire insurance
- Google Scholar: California insurance regulations
- Encyclopedia Britannica: Insurance
- Google News: California insurance laws
Author: Anaheim Staff Writer
Anaheim Staff Writer The Anaheim Staff Writer represents the experienced team at HEREAnaheim.com, your go-to source for actionable local news and information in Anaheim, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as major conventions at the Anaheim Convention Center, including NAMM and VidCon, exciting games at Angel Stadium and Honda Center, and developments at Disneyland Resort Our coverage extends to key organizations like the Anaheim Chamber of Commerce and Visit Anaheim, plus leading businesses in hospitality, entertainment, and innovation that power the local economy As part of the broader HERE network, including HERECostaMesa.com, HEREHuntingtonBeach.com, HERESantaAna.com, and HERELosAngeles.com, we provide comprehensive, credible insights into Southern California's dynamic landscape.
