Lara and Senator Ben Allen praise important consumer protection measure signed by governor

California wildfire survivors will now face one less burden on their road to recovery as Governor Gavin Newsom signed Senate Bill 495, authored by Senator Ben Allen and sponsored by Insurance Commissioner Ricardo Lara.

Beginning in January 2026, in the event of a declared emergency, insurance companies will be required to pay 60 percent of personal property (contents) coverage limits, with a cap of $350,000, to policyholders who experience a total loss without requiring policyholders to submit a detailed inventory for at least 100 days.

"The recent LA Fires exposed difficult inefficiencies in our insurance system that unnecessarily delay the urgently needed financial support survivors are justly due," said Allen. "I am grateful to have worked with Insurance Commissioner Lara over the past year to ensure fairer upfront payments are moving out the door quickly and without overburdening those who just lost everything. Thank you, Governor Newsom for recognizing we can and must do more to support disaster victims on the difficult road of recovery."

Under the current law, insurance companies are only required to pay 30 percent of primary structure (dwelling) coverage limits, and it is capped at $250,000. Not only is this formula confusing for policyholders given it is based on primary structure coverage, but it often results in insufficient payments for properties with higher limits – examples of which were common in the recent Los Angeles wildfires. Policyholders are also currently required to complete a content inventory and to submit proof of loss to insurers within 60 days of loss. This process is unduly burdensome for policyholders and unrealistic as many policyholders in the recent wildfires did not have access to their insured property for an extended period of time due to unsafe or hazardous conditions.

This bill also requires insurers to provide the Department of Insurance annual, point-in-time reinsurance and catastrophe model data for policies written in California for the previous year. A key element of Lara's Sustainable Insurance Strategy is to expand the writing of insurance policies for consumers in wildfire areas and protect the long-term strength of the California insurance market. Having clear, point-in-time data on reinsurance and catastrophe modeling associated with wildfire risk will help protect the strength of the California insurance market and work to address availability concerns. With this data, the Department will publicly aggregate results, evaluating short- and long-term market trends and scenarios.

"Senator Allen and I worked to enhance consumer protections based on the experiences of wildfire survivors. It is inhumane to require survivors to list destroyed items before receiving benefits," said Lara. "By ensuring a fair upfront payment, we ease a significant burden for survivors, allowing them to focus on what truly matters after a catastrophe: finding shelter and starting the long journey to recovery with dignity, compassion, and meaningful financial support."

This bill will also give the Insurance Commissioner authority to either issue a bulletin or promulgate regulations that describe the parameters of any attestation forms that insurers may require policyholders to sign. This will make the process clearer, more supportive, and less burdensome for policyholders who are already navigating a traumatic experience.