Election 2026: California insurance commissioner’s race — Fix the private market or provide public coverage?

The two Democrats running for California insurance commissioner offer voters a stark choice for tackling a wildfire-driven home insurance crisis as premiums surge and insurers drop thousands from their plans: Can the state fix the private market, or should it step in with its own coverage?

Jane Kim, a former member of the San Francisco Board of Supervisors, has centered her campaign on a proposed state-run disaster insurance program she says will lower costs and expand coverage, despite skepticism from some analysts and consumer advocates. Her opponent, Los Angeles state Sen. Ben Allen, calls instead for building on and improving current efforts to stabilize the state’s home insurance marketplace.

Dan Schnur, a political science professor at UC Berkeley and the University of Southern California, said the race pits a progressive in Kim, who he said is “much more suspicious of big business,” against a center-left Democrat in Allen, who he said seeks to closely regulate insurance companies but is “aware of the risk of driving them out of the state altogether.”

In the June primary, Kim won 27% of the vote, the most among all 11 candidates in the race for state insurance commissioner. Allen came in second with 19%. The current commissioner, Democrat Ricardo Lara, is termed out.

The insurance commissioner leads the state agency that approves rate hikes for home and auto plans, investigates complaints against insurers and advances policies meant to keep insurance affordable and available. While many voters may be unfamiliar with the position, it has become an increasingly critical role as destructive blazes have upended California’s home insurance market.

Citing the growing wildfire risk, insurance companies have repeatedly won approval in recent years to raise homeowner premiums while dropping policyholders across fire-prone parts of the state. Some of the largest insurers, including State Farm and Allstate, have even paused writing new home policies anywhere in California.

Insurers blame California’s regulatory environment, established by a 1988 consumer advocate-backed voter initiative, Proposition 103, which created the elected commissioner’s office that reviews providers’ policy rate increases. Insurers have argued that the commissioner’s office hasn’t allowed them to price risks adequately, straining their ability to cover catastrophic wildfire losses.

A Republican candidate and insurance broker, Stacy Korsgaden, who ran on loosening state regulations, was eliminated in the June primary.

Kim’s solution is to drastically reduce the private sector’s role in wildfire coverage. She calls for a public natural disaster insurance program that most homeowners would pay into, guaranteeing universal coverage for catastrophes such as wildfires and floods.

“The system failure has reached a pain point for voters,” Kim said. “People are tired of going down this pathway, and what we’re proposing is to rethink the system.”

Kim said putting the state in charge of disaster coverage would allow it to invest a portion of the premium revenue collected in wildfire mitigation. She cites a similar program in New Zealand, which officials there describe as a success but critics warn could face funding challenges in the years ahead. Kim said her proposal would require further study, but said removing the profit motive from disaster insurance would, over time, lower premiums for many homeowners — though no other state has tried a comprehensive universal disaster program.

In addition to the disaster plan, homeowners would need to pay for separate private insurance for general home coverage.

Kim’s critics, including some consumer advocates, contend the program would saddle the public with the greatest liability, warning of potential taxpayer bailouts after large disasters. They also note the program would need state lawmakers’ approval and likely require tens of billions of dollars to launch. Kim says the state could raise the money in part through fees on insurance companies.

“One state cannot scrap the current system and build disaster insurance,” said Amy Bach, executive director of United Policyholders. This nonprofit consumer advocacy group has not taken a position in the race.

Kim, a key strategist in Bernie Sanders’ 2020 campaign, joins a slate of progressives on general election ballots across the country, led by Michigan U.S. Senate candidate Abdul El-Sayed. Left-wing candidates, emboldened by last year’s election of New York Mayor Zohran Mamdani, see this November as an opportunity to capitalize on voter frustration over affordability and what they see as growing distrust in mainstream candidates.

“People are hungry for real progressive change,” said Jorge Contreras, California director of the progressive Working Families Party, which has endorsed Kim. She previously served as the party’s California director.

Kim, who has also won Sanders’ endorsement, 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, who reaches his term limit as senator this year, and his allies say he also shares progressive values. They point to his work authoring a $10 billion climate bond that voters approved in 2024, as well as consumer protection bills, including legislation on Gov. Gavin Newsom’s desk to bolster penalties for insurers that violate state insurance regulations.

Still, Allen agrees with Kim’s critics who say her proposal for a public insurance program is unworkable.

“What we need is a real plan that’s actually grounded in the problems facing the system right now,” he said, adding Kim’s proposal “would take years to implement” and “bankrupt the state.” Kim responded to such criticisms by acknowledging the state would phase in the plan in stages to ensure financial stability. She added that investing in wildfire mitigation would lower the overall fire risk, in turn keeping claims paid by the program in check.

Former state Insurance Commissioner Dave Jones, who has endorsed Allen, said the senator’s experience in the state legislature would be crucial for working with lawmakers, consumer advocates and insurers to carry out his policies as commissioner.

“He’s proven time and time again his ability to move very hard-fought, heavily opposed but important legislation,” Jones said.

Allen said one of his main priorities would be expanding the state’s wildfire mitigation programs, including grants for homeowners and neighborhoods to clear vegetation and make fire-risk properties more insurable. Allen said new funding should come not only from the state, but also from insurance companies, utilities whose equipment has sparked recent blazes and fossil fuel companies contributing to climate change. He acknowledged securing that funding would need legislative approval, as the state faces a long-term budget deficit.

“At the end of the day, what’s really going to move the needle is great focus on individual and community-wide resilience,” he said.

Allen also supports continuing a plan by the current commissioner that lets insurers use climate change models to justify rate increases to state insurance regulators. In exchange, insurers must agree to write more policies in high-fire areas.

Consumer advocates, however, have raised concerns the plan lacks teeth to require insurers to expand coverage. They also say the complex climate models, which advocates describe as a “black box,” could lead to steep rate hikes across the state.

Allen said he his open to reviewing the plan and is committed to making sure insurers expand coverage, but did not provide specific details about how he would do so. He said he would use a climate model being developed by the state to gauge whether insurers’ models are fair and accurate, and use the commissioner’s regulatory authority over rates to prevent out-of-control increases.

Allen’s campaign has raised about $1.6 million, with top donors including a mix of business and labor interests. This month, Chris Larsen, billionaire co-founder of cryptocurrency company Ripple, reported contributing almost $1 million to an independent committee supporting Allen.

Kim supporters with the Working Families Party said Larsen’s donation raises questions about whether Allen is beholden to “crypto bros” and corporate interests. Allen’s campaign dismissed the suggestion as “mudslinging.”

Allen has also won the endorsement of the California Democratic Party, a key signal to voters that often establishes a candidate as a favorite in a down-ballot race. But given many voters’ apparent eagerness for progressive policies this election cycle, it by no means makes Allen the frontrunner, according to Schnur, the political science professor.

“Allen certainly has very strong progressive credentials in his own right,” Schnur said. “But what we’re seeing in other races is that the most enthusiasm is for left-wing Democrats.”

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