California Insurance Commissioner Ricardo Lara and the California Department of Insurance have sponsored six new laws, that were effective on January 1, 2021, bringing forth new protections for California consumers. The laws were implemented to help wildfire survivors to recover faster, and to defend the rights of domestic workers and small businesses during a state of emergency. The laws are as follows:

Senate Bill 872

This law removes barriers for future wildfire survivors to receive critical insurance benefits, and also streamlines the wildfire recovery processes for California homeowners who suffer losses caused by wildfires. The law will require an advanced payment for no less than four months of Additional Living Expenses (ALE), and will no longer require itemized inventory forms submitted for content claims. The law includes other consumer protections. On July 1, 2021, the law will expand ALE benefits and include policyholders whose homes are rendered uninhabitable due to wildfire damage to essential infrastructure.

Assembly Bill 2658

This law protects domestic workers from employer retaliation if they refuse to work in hazardous conditions, including wildfires. It also prevents an employer from ordering an employee or a household domestic service worker, to remain in or enter a mandatory evacuation zone caused by wildfires or a public health order, such as circumstances caused by the COVID-19 pandemic.

Assembly Bill 2756

This law provides additional insurance for disaster survivors to rebuild, and requires increased levels of transparency when a new policy is sold that does not cover wildfire losses. It also reduces the burden of a home rebuild on disaster survivors.

Senate Bill 1192 

This bill creates department oversight of public safety workers' benefits associations so the department can make sure that these associations provide financially sound insurance benefits and are transparent to association members.

Assembly Bill 2049 

This bill incorporates revisions to the Credit for Reinsurance Model Regulation, approved by the National Association of Insurance Commissioners (NAIC). The bill prevents federal preemption of California's existing law regarding credit for reinsurance, and retains the state's accreditation by the NAIC.

Senate Bill 1255 

This bill was co-written by one senator and the Senate Insurance Committee and cleans up and clarifies several issues identified by the Department in the Insurance Code. The text of the law also includes the Equal HIV Insurance Act, effective January 1, 2023, which will prohibit an insurer from declining an application or enrollment request for coverage under a policy for life insurance or disability income based solely on the applicant's HIV status.

Commissioner Lara also strongly supported several other consumer protection bills, and bills that address social and racial injustice including one that requires health insurance companies to provide some coverage for mental health and substance use disorders equal to coverage provided for other medical conditions. Another bill will require public companies with a principal executive office in California to include members from historically underrepresented communities on their boards of directors or incur financial penalties invoked by the California Secretary of State.

Editor's Note: California is often ahead of the curve when it comes to most legislation and regulation, and the California Insurance Department is no exception to that tendency. Keep an eye out for other state insurance departments to follow suit, perhaps not on the wildfire front specifically, but in providing consumer protection, disaster survivor relief, and standing for historically underrepresented communities and mandating standards for insureds that suffer from mental illness or substance use disorders.

You can read more about the new bills and laws out of California, here.