California to require insurance discounts for property owners who reduce wildfire risk
California Gov. Jerry Brown on Tuesday said he’s ready to take his fight against wildfires from the Legislature to the ballot box, when residents overwhelmingly reject the governor’s attempts to give more property insurance discounts to homeowners who use fire regulations to reduce their own risk from wildfires.
Brown on Tuesday defended his move to place regulations on insurance companies and force them to offer discounts when they sell fire insurance.
It’s the latest push toward voter-approved limits on risk-based property insurance, following last year’s ballot Proposition 25, which capped monthly payments for fire insurance on homes. The insurance industry has countered with a ballot initiative, Proposition 51, that would prohibit insurers from offering discounts to fire-prone homeowners.
Proposition 25 was ultimately defeated, but the Insurance Information Institute, which supports Proposition 51, said California could face a loss of insurance profits if the industry doesn’t offer discounted coverage.
“The current regulatory environment is not the right environment to encourage competition in the insurance marketplace and, once again, the insurance companies have the upper hand on the public,” said Mark Fabian, a policy economist with the institute.
Brown said the state would move forward with the ballot initiative, which is set to go before the Senate in December, but said he’s open to working with the public.
“I’m very interested in working, when it comes to the insurance issue, with the Legislature to make sure that we get our policies in California as cost-effective and as simple as possible,” he said.
Opponents said the move could drive up insurance prices and create a disincentive to take proactive steps to avoid insurance losses.
“Just because you have insurance doesn’t mean you can afford to take the preventative measures that really help you get the most out of your property, rather than having it burn down,” state Sen. Mike McGuire, D-Healdsburg, said.
McGuire said that under Proposition 51, homeowners would pay twice as much for insurance and would no longer be