California has always had it rough when it comes to wildfires, but this past year has been one for the record books. So many residents have been directly affected by devastating wildfires the the governor is stepping in to combat some insurance issues that have come to light as a result of so many wildfire claims.
A few days ago, California Governor Jerry Brown signed bill AB 1797 into law. AB 1797 was spearheaded by Assemblyman Marc Levine, D-Marin County. The law will require insurers that are writing residential property insurance policies to conduct a replacement cost estimate every other year.
Hopefully, by requiring consistent evaluations of replacement costs less people will find themselves in a scenario where their policy does not have enough coverage to help them in the event of a total disaster—like losing your home to a wildfire.
Marc Levine spoke with the Insurance Journal about this bill, saying that “We heard from wildfire survivors about the devastating realization of being underinsured due to inaccurate or outdated replacement cost models used by insurers…After facing the most destructive wildfires in state history, Californians should not have to begin the recovery process underinsured. California has prioritized protecting consumers and helping prevent underinsurance.”.
This isn’t the first piece of legislature that California has enacted in response to a devastating wildfire season. AB 1799 was passed to require insurers to standardize the information they provide to fire victims after a loss. Policyholders must be notified of all the information they need to understand their policy, the coverage provided, any endorsements to the policy and the policy declarations page.
Wildfires are a natural disaster that California is going to have continue dealing with for the foreseeable future. It’s important that the state continues to pass legislation like this to deal with a threat that is only proliferating as time goes on.