EDITORIAL: Endorsement: Elect Ben Allen California's next insurance commissioner

East Bay TimesContra Costa Times

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There is no greater looming threat to affordability in California than its home insurance crisis.

Housing prices in the state have played the central role in its loss of residents to other states for two decades, but insurance costs have not. Strict consumer protections since the late 1980s kept premiums down to among the lowest in the country.

But increasingly devastating wildfires are unraveling one of the last bargains Californians have enjoyed.

Over the last four years, carriers have retreated from the state entirely or have paused writing new policies. Rates have risen sharply across the Bay Area.

Meanwhile, homeowners throughout the region — from rural Sonoma County to suburban San Jose — have been pushed into the FAIR Plan, the state's high-risk pool offering expensive, limited coverage. Disconcertingly yet unsurprisingly, the prospect of rising premiums is sinking home sales.

With the Nov. 3 election approaching, California voters must understand: When they choose between the two Democrats — Ben Allen and Jane Kim — running to replace termed-out Insurance Commissioner Ricardo Lara, the viability of homeownership is on the ballot.

Ben Allen is our choice to navigate California through this unprecedented crisis.

Here is how we reached our decision in favor of the 48-year-old state senator who has represented western Los Angeles County, including areas destroyed by the Palisades Fire, for 12 years.

Since Californians passed Proposition 103 in 1988, the insurance commissioner has had powerful independent authority over the country's largest property and casualty insurance market. Insurers, for example, must receive approval from the commissioner's Department of Insurance before they can raise rates.

However, as powerful as this office is, many underlying causes of today's metastasizing crisis — climate change, land-use policies, construction costs and fire suppression tactics — lie outside of the commissioner's direct control.

Allen — who placed second in the June primary with 19% of the vote — understands the limits of this office. In fact, he is the only candidate who consistently frames the problem as a system-wide challenge necessitating that insurers, lawmakers, developers, homeowners and polluters align.

Treat the causes

As Allen explained to our editorial board, the next commissioner must work hand in glove with the state Legislature on policies that will materially lower risks. That means updating our building codes to require more fire-resistant materials; revising our land-use policies to minimize building in predictably flammable areas at the edge of wildlands; and disincentivizing oil companies from further exacerbating climate change.

These changes are the preconditions for lower rates.

Allen's advantages are twofold:

He is humble enough to acknowledge the insurance commissioner cannot solve this problem by fiat, and he has the legislative record and relationships in Sacramento that will be necessary to craft broader solutions.

Further, unlike Kim, Allen has already been working on these issues in the Legislature. He co-authored Prop. 4, a $10 billion statewide wildfire prevention and climate resilience bond approved by voters in 2024.

Doing this job right requires navigating state politics, negotiating with competing economic interest groups and managing a 1,400-person bureaucracy that oversees more than 1,600 insurance companies. Ben Allen convinced us he could operate inside this maze. His opponent, Jane Kim, did not.

Unaffordable experiment

Kim recognizes, correctly, that the private insurance market is struggling to absorb climate risk.

But the 49-year-old former San Francisco County supervisor's solution — a single-payer-style public disaster insurance program — is poorly defined and presents an enormous risk for a state struggling with chronic deficits.

Kim — who won 27% of the vote, the most among the 11 candidates in the June primary — points to New Zealand as a proof of concept. But we already have an example of a state-run insurance program here in the U.S. The National Flood Insurance Program is in constant financial distress as its premiums routinely fail to cover the escalating costs created by ever-larger, disastrous floods.

Californians cannot afford Kim's experiment.

Kim has raised about $1 million for her campaign. Her top donors include unions for teachers, nurses and service workers. An independent campaign committee sponsored by the California Chamber of Commerce has spent $1.5 million to oppose her.

Allen's campaign has raised about $1.6 million, with top donors including a mix of business and labor interests. He has also won the endorsement of the California Democratic Party.

Whoever wins has no easy options.

Over-regulating could scare more insurers away; under-regulating could inflate prices even more. Meanwhile, the conditions for deadlier and more destructive wildfires at the intersection of nature and our cities keep growing. And there is no end in sight.

There is only one candidate who grasps the complexity of this crisis and has the legislative experience to address it.

That is Ben Allen.