Bay Area congressional representatives are spearheading efforts to entice property insurance companies back to California through proposed legislation designed to mitigate losses and promote disaster preparedness among property owners.
U.S. Rep. Mike Thompson (D-St. Helena) unveiled bipartisan legislation on Thursday aimed at rejuvenating the insurance sector in the wake of major carriers withdrawing from the state due to wildfire and flood risks. Co-authored by Doug LaMalfa (R-Richvale) and co-sponsored by Rep. Jared Huffman (D-Marin), the bill, known as House Resolution 7849 or the Disaster Resiliency and Coverage Act, seeks to establish a grant program and provide tax incentives to property owners who undertake measures to fortify their properties against disaster threats.
The initiative comes in response to the exodus of insurers such as State Farm, Allstate, and Farmer’s from the California market, leaving homeowners and businesses struggling to secure coverage. According to Thompson, the bill proposes a strategic solution by incentivizing disaster resiliency, thereby making the state more attractive for insurers to operate in.
“At its core, our bill incentivizes disaster resiliency efforts, which we believe will entice insurers to return to our housing markets,” remarked Huffman during the bill’s announcement.
Under the proposed legislation, property owners could receive grants of up to $10,000 for resiliency work facilitated by the Federal Emergency Management Agency (FEMA). Additionally, larger property owners would be eligible for tax breaks covering 30% of resiliency costs incurred from hardening techniques such as creating defensible space and using fireproof building materials.
Thompson and Huffman unveiled the bill during a press conference in Santa Rosa’s Coffey Park neighborhood, which suffered extensive damage from the 2017 Tubbs Fire. This disaster claimed thousands of structures and lives, highlighting the urgent need for proactive disaster mitigation efforts.
“Homeowners across California are struggling to find coverage as insurers retreat from the market,” Thompson emphasized. “Our legislation aims to reverse this trend by fostering a more resilient built environment.”
The bill also addresses the economic consequences of uninsured properties, noting that homeowners can lose up to 12% of their property’s value when left without insurance coverage.
Rohnert Park Mayor Susan Hollingsworth-Adams voiced support for the bill during the press conference, underscoring the significant economic impact on cities if insurance coverage becomes unattainable.
The Disaster Resiliency and Coverage Act now awaits consideration by the House Ways and Means and Transportation and Infrastructure Committees, representing a critical step toward addressing California’s insurance market challenges in the face of escalating disaster risks.
