Consumers deserve to know how well insurance companies fulfill their responsibilities to pay claims fairly, and they need to have this information before making the purchase decision. The Department of Insurance already collects data called the “justified claims ratio,” where it analyzes consumer complaints against insurance companies claims behavior and determines what ratio of those complaints are justified. I will have the Department create an easy to understand report card grading each insurance company using this data, and I will mandate that the report card be provided to consumers before making the purchase decision.

By the end of 2025 the California Forestry Board will finalize a set of regulations called “Zone Zero” that are scientifically designed to reduce fire risk. Once these Zone Zero regulations are published, insurance companies must be required to offer discounts to customers who have faithfully followed the regulations that reduce fire risk at the house and neighborhood level.

Modern wildfires are creating unprecedented levels of smoke damage that insurance companies are not sufficiently including in their coverage. The Department of Insurance has recently created a Smoke Claims & Remediation Task Force that is charged with developing statewide standards for smoke claims. I will mandate the findings of this Task Force be included in all home insurance policies sold in California, and hold insurance companies accountable for paying smoke damage claims.

The typical homeowners’ insurance policy significantly underestimates the replacement cost of a property. As a result, many Californian homeowners are deeply underinsured, which means they don’t get paid enough to rebuild after a disaster. The root cause is that insurance companies all use the same software to estimate replacement cost, and the software estimates are biased to estimate too low. The Department of Insurance can fix this because it has data on the average level of underinsurance. I will mandate this data be made available at the point of purchase, that an estimate be provided of the amount of ERC required to close this gap, and that the ERC be made available at the point of purchase.

One of the key factors limiting choice and competition in California’s insurance market is how long it takes for insurance rate applications to be reviewed. The national average for a rate application review is 60 days, but in California it takes nearly 300 days. We can dramatically speed up the rate review process to be much closer to the national average by streamlining standard rate applications. This will make competitive rates available to consumers faster and make it easier for more companies to do business in California.

California must take the scientifically backed action necessary to reduce wildfire severity. The state should be doing 500,000 acres/year of controlled burns to reduce the risk of catastrophic wildfires. Instead, we are only doing approximately 100,000 acres/year. I will use the role of the Insurance Commissioner office to explain the urgency of this issue. This will reduce the cost of insurance and make it easier for insurance companies to do business here. It will also protect property, and, most importantly, save lives.

Telematics refers to installing a device in the automobile to directly track driving behavior. California is the only state in the US that does not allow using telematics to underwrite auto insurance. Allowing telematics has many potential benefits: (1) more efficient and ultimately lower pricing of insurance; (2) safer driver behavior; (3) providing objective data to challenge biased policing; (4) attracting more auto insurance companies into California – which would also increase home insurance competition, because auto insurance and home insurance are often sold together. To be clear, there are very important privacy concerns with telematics, which I take very seriously. However, every other state in the US has developed regulations that meet the privacy needs of its residents, and I believe with proper study California can do so also.

For many years, California’s regulations have not allowed insurance companies to use forward-looking models or to include the cost of reinsurance in underwriting homeowners’ insurance. (Reinsurance is when an insurance company buys insurance from other insurance companies in order to reduce risk, which is a standard practice in the industry.) The Department of Insurance is changing those regulations in what it calls the Sustainable Insurance Strategy. This is a critical reform. As Insurance Commissioner, I will ensure this reform is carried forward and strengthened, to allow more insurance companies to enter the California market to increase availability of insurance.

The California FAIR Plan is a jointly operated syndicate of all licensed insurance companies in California, which is required to offer basic fire insurance to anyone that is otherwise unable to get coverage. It is supposed to be a “last resort” that is only very rarely used. Instead, because of the failure of California’s regular insurance markets, it is the fastest growing insurer in the state and it is quickly also becoming one of the largest. The FAIR Plan was never designed to provide adequate service to so many customers. It is imperative to heal the regular markets as quickly as possible. This will allow customers to go back to the normal insurance companies who can provide better service, and will align rates with the correct level of risk so that rates are fairer for everyone. In the meantime, the Department of Insurance must invest the resources the FAIR Plan needs and require insurance companies to fix their management and oversight of the FAIR Plan so that it can provide adequate service for customers who currently lack alternatives in the regular markets.