California lawmakers are already expressing concern about the state’s plan to ease the insurance crisis.
The Placer County community of Foresthill is one of many in the path of a wildfire that is now facing insurance problems.
“You have insurance companies pulling out of California because they say, ‘There are too many big fires,’ and California has big fires, no doubt about it,” said California Representative John Garamendi. “But in the last two years, we haven’t had any big fires.”
The congressman is one of 32 Democratic lawmakers concerned about the state’s sustainable insurance strategy.
“Our letter to [California Insurance] Commissioner [Ricardo] Lara is to use your power to analyse this market and fix it,” Garamendi said.
In communities like Foresthill, rates have skyrocketed and other areas have been deemed more at risk.
“Do rates need to be raised? Do they need to be doubled and quadrupled like they are across the state? Do policies need to be cancelled? If so, why?” Garamendi asked.
That was the crux of the issue, one that California Department of Insurance (CDI) spokesman Michael Stoller says can be mitigated.
“What you’re going to see in the coming months is the department authorising insurance companies to offer discounts,” Stoller said.
The CDI disagrees with the watchdog’s claim that the deal favours insurers.
“What’s clear from the meetings we’ve had with Californians across the state is that we need more tools, not fewer regulatory tools,” Stoller said.
As both sides feel the heat from consumers, “32 members of Congress are getting hammered by our constituents saying, ‘What’s going on here?'” Garamendi said.
The CDI said help will soon arrive in the form of new initiatives … while industry outlooks put that range between this year and 2026.
