In response to the recent catastrophic wildfires, the California Department of Insurance (DOI) Commissioner issued a one-year mandatory moratorium on non-renewals, specifically due to wildfire risk, in efforts to assist impacted policyholders, minimize adverse effects on real estate markets, property values and other services offered in the affected communities. Insurers shall not cancel or non-renew for one year any homeowners, condo unit owners, mobile homeowners, or residential renters policies, due to wildfire risk, that are located in a zip code identified by the bulletin or any subsequent associated bulletin.
Additionally, the commissioner requested that insurers voluntarily cease all non-renewals for wildfire risk on homeowners, condo unit owners, mobile homeowners, residential renters, and commercial property policies in the state of California until December 5, 2020, on the heels of the Governor Newsom’s statewide emergency declaration due to fires and extreme weather. According to the California Department of Insurance, “A statewide moratorium would provide all California homeowners, renters, and businesses peace of mind, and allow time for stakeholders to come together to work on lasting solutions, help reduce wildfire risk, and stabilize the insurance market.”
More than 800,000 residential policies in zip codes adjacent to recent wildfire disasters are covered under the mandatory one-year moratorium per the newly enacted Wildfire Safety and Recovery Act. As of January 1, 2020, the new law expands protection to those who, despite not suffering a total loss, live adjacent to a declared wildfire emergency.
Furthermore, the Insurance Commissioner issued a notice asking all property and casualty insurers to implement emergency expedited claim handling procedures and billing grace periods to assist residents and business in recovery. With regard to billing, the Commissioner suggested insurers grant billing leniency for at least 60 days for those in wildfire designated areas and noted that victims may not have the ability to receive mail or may lose their renewal notices.
For a listing of emergency declarations and impacted areas, please review announcements linked above.