California Proposes Insurance Policyholder Bill of Rights

California, September 23, 2025

News Summary

Consumer Watchdog has filed the Insurance Policyholder Bill of Rights in California, aimed at ensuring homeowners receive insurance coverage for fireproofed homes. The proposal seeks to protect policyholders from losing coverage amidst rising wildfire risks. It includes provisions requiring insurers to offer policies to homeowners who take mitigation steps and imposes a five-year ban on non-compliant insurers from selling insurance. With a push for reform in the insurance market, California residents express frustration with claims handling as wildfire concerns grow.

California – A significant proposal has emerged aimed at protecting California homeowners from insurance coverage losses due to wildfire risks. The consumer advocacy group Consumer Watchdog has filed the Insurance Policyholder Bill of Rights with the state Attorney General Rob Bonta’s office, seeking to secure a spot on the November 2026 ballot. This initiative requires insurers to offer coverage to homeowners who fireproof their homes. Noncompliance would carry severe consequences, including a five-year ban on selling home or auto insurance in California.

The proposal is a direct response to the increasing trend of insurers canceling homeowners’ policies after claims related to wildfire damages. Homeowners not renewed by their insurance providers would have 180 days to make necessary home repairs and improvements. This measure aims to create a safety net for policyholders who invest in wildfire mitigation, ensuring they retain access to insurance coverage.

Harvey Rosenfield, the founder of Consumer Watchdog and the author of Proposition 103, has expressed strong support for the initiative, emphasizing the need for guaranteed coverage for homeowners actively working to reduce wildfire risks. Recently, two lawsuits have been filed in Los Angeles County Superior Court involving California home insurers that have dropped policies and pushed affected homeowners onto the state’s FAIR Plan, which is California’s insurer of last resort. While this plan provides coverage, it often comes with higher costs and limited benefits.

Insurers in certain areas can request six-month waivers of the coverage rule if they can prove an overconcentration of risk. The proposed initiative follows years of insurers retreating from the California insurance market due to the increasing frequency and severity of wildfires, which has, in turn, led to substantial rate hikes for homeowners seeking coverage.

However, uncertainty looms regarding the initiative’s potential for success. Carmen Balber, the executive director of Consumer Watchdog, has indicated doubts about whether the group can gather the required 500,000 signatures needed to qualify for the ballot. In addition, the initiative was partially spurred by a rival proposal from Elizabeth Hammack, an insurance broker. Hammack’s initiative seeks to repeal critical reforms of Proposition 103, allowing insurers to impose rate hikes before obtaining approval from the insurance commissioner, who, according to her plan, would also need a minimum of five years of insurance-related experience.

The current climate for California’s home insurance market is one of widespread complaints regarding the handling of claims. Many homeowners, particularly those affected by the January 7 fires that resulted in numerous losses, have voiced frustrations with the claims processes. State Farm, California’s largest home insurer, has received particular criticism for its claims handling practices. In light of this situation, Governor Gavin Newsom has urged the FAIR Plan to expedite and fairly manage claims related to smoke damage from the January 7 fires. Concurrently, the California Department of Insurance has taken legal action concerning the state’s insurer of last resort over denied smoke damage claims.

Public sentiment towards insurers is running high, with notable anger directed at their treatment of claims, especially after the devastating January firestorms, which led to over 30 fatalities. This mounting dissatisfaction highlights the urgent need for regulatory reforms, represented by the proposed Insurance Policyholder Bill of Rights.

Summary of Key Features of the Initiative

• Insurance Policyholder Bill of Rights proposed by Consumer Watchdog
• Insurers must offer coverage to homeowners who fireproof their homes
• Noncompliance results in a five-year ban from selling insurance
• Homeowners not renewed have 180 days for needed repairs
• Follows lawsuits against insurers for policy cancellations
• Prompted by rising wildfire risks and insurer rate hikes

FAQ

Deeper Dive: News & Info About This Topic

• Los Angeles Times: Insurance Rights Initiative Proposed
• U.S. News: Homeowners Insurance in California
• New York Times: LA Fire Home Insurance Legislation
• Daily Journal: Property Insurance Rules for Wildfire Recovery
• LAist: Ballot Initiative on California Insurance
• Wikipedia: Insurance
• Google Search: Insurance California
• Google Scholar: California Home Insurance
• Encyclopedia Britannica: Insurance
• Google News: California Home Insurance

Author: STAFF HERE MISSION VIEJO WRITER

MISSION VIEJO STAFF WRITER The MISSION VIEJO STAFF WRITER represents the experienced team at HEREMissionViejo.com, your go-to source for actionable local news and information in Mission Viejo, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Oso Fit 5K Fun Run and Community Health Fair, Walk Against Drugs & Community Fair, and National Night Out. Our coverage extends to key organizations like the Mission Viejo Chamber of Commerce and Providence Mission Hospital Mission Viejo, plus leading businesses in retail and education that power the local economy such as The Shops at Mission Viejo, Capistrano Unified School District, and Amazon Delivery Station. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.