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California Home Insurance Reforms Pass Legislature
9 Sep
Summary
- New laws aim to increase insurer fines for legal violations.
- Policyholders will get more notice before coverage is dropped.
- Insurers must provide homeowners with replacement cost estimates.
California lawmakers have advanced significant legislation to reform the state's home insurance market, sending several bills to Governor Newsom's desk. These reforms aim to address issues like underinsurance and slow claims processing, ensuring policyholders receive greater protection.
Key provisions include doubling penalties for insurance companies that violate state laws during emergencies and mandating that insurers offer at least 50% extended replacement cost coverage. Homeowners will also receive more advance notice, 90 days instead of 75, before their policies are non-renewed, with a potential 120-day notice if issues can be remedied.
Furthermore, insurers will be required to provide policyholders with estimates for rebuilding their homes and supply all preliminary and final claim documents upon request within 15 days. This increased transparency aims to ensure fair claim handling and prevent policyholders from being underinsured after catastrophic events.
