Marin fire officials welcome proposed state insurance rules

Marin fire officials are lauding expanded regulations for wildfire insurance aimed at improving safety standards and driving down the cost of coverage for homeowners and businesses.

The new regulations, released Friday by the state Department of Insurance, incorporate the new “safer from wildfires” framework, a list of expert-endorsed actions to help save lives and reduce risk for property owners rolled out last month.

The regulations would require insurance companies to factor in all wildfire safety actions taken by a property owner when pricing residential and commercial coverage. The regulations also aim to give consumers transparency about their “wildfire risk score” that insurance companies assign to properties, which can increase the price of insurance.

If approved, the regulations would go into effect this summer.

“With more Californians rolling up their sleeves and reaching into their own pockets to protect their homes and businesses, insurance pricing must reflect their efforts,” Insurance Commissioner Ricardo Lara said. “Holding insurance companies accountable for accurately rating wildfire risk in the premiums they charge Californians will help save lives and reduce losses.”

Homeowners described costly efforts to protect their homes in meetings around California before the pandemic, and in an online investigatory wildfire hearing in October 2020. Currently, 17 insurance companies, or 40% of the market, have begun offering discounts, up from 7% of the market in 2019.

Homeowners rarely have access to their wildfire risk score or know how they can improve it, since companies are not required to provide that information, according to the state. The new regulations intend to require the ability for people to review their score, and appeal the factors used to assess their property if they take new actions to improve the safety factors, such as through vegetation management.

“People are often motivated by their wallet,” said Chief Jason Weber of the Marin County Fire Department. “If they’re extended discounts for this, it certainly incentivizes them to do the work.”

Knowledge of the wildfire risk score also can help fire agencies and residents better communicate about home fire prevention methods, Weber said.

“The new framework is identical to what we are preaching here in Marin County, and a big part of what Marin Wildfire Protection Authority is working on,” he said. “When residents have access to grant funds coupled with insurance incentives, it really does become real money, but it also is common messaging. We don’t want someone to feel overwhelmed by the work that needs to be done.”

“This is the most significant, concrete step forward on wildfire safety that brings all of the pieces together to help Californians maintain and obtain high quality insurance at a reasonable cost,” Novato Fire Protection District Chief Bill Tyler said. “This helps people take back control over their risk by having insurance companies recognize their efforts.”

“Now that experts concur and the ‘safer from wildfires’ framework has been established, we need regulations to ensure that consistent and clear rewards will be in place to incentivize and accomplish wildfire risk reduction at the parcel and community level,” said Amy Bach, executive director of the San Francisco nonprofit United Policyholders.

Jamie Johansson, president of the California Farm Bureau Federation, said, “By pricing insurance to recognize farmers’ wildfire safety efforts, these regulations will help drive insurance companies to better support our agriculture sector, which is not only critical to our state but to our entire country.”

Assemblymember Marc Levine, a Marin County Democrat who is challenging Lara for commissioner, said the proposed regulations “are long overdue” but fall short on enforcement and transparency.

He said his proposed legislation, AB 1755, requires a guarantee of insurance issuance to residents who properly harden their home from fire using proven standards, and aims to create a grant program directly to a qualifying homeowner to pay for the cost of home hardening.

“Homeowners and renters should be benefiting from these investments they’re making,” said Levine. “The proposed regulation does not provide the transparency necessary to help people (understand) the risk models that impact premiums for homeowners.”

The new regulations will be discussed at a public hearing April 13 in Oakland.