California, September 27, 2025
News Summary
California Governor Gavin Newsom is reviewing Senate Bill 429, which proposes establishing the nation’s first public wildfire catastrophe model aimed at improving wildfire risk assessment and insurance regulation. The bill seeks to enhance transparency in fire risk data and promote accountability among insurers, as well as establish a program for research and risk mitigation strategies. While supported by the insurance industry, consumer advocates have raised concerns regarding transparency and algorithm accountability.
California – Governor Gavin Newsom is currently reviewing Senate Bill 429, which proposes the establishment of the nation’s first public wildfire catastrophe model. This bill aims to transform the state’s approach to wildfire risk assessment and insurance regulation, highlighting the urgent need for improved strategies following devastating wildfire seasons.
Senate Bill 429 seeks to expand existing laws mandating insurers with more than $10 million in written California premiums to submit fire risk data for their insured residential properties. The California insurance commissioner will be responsible for making this fire risk information accessible to the public, paving the way for increased transparency and accountability within the insurance industry.
To support the creation of the public wildfire catastrophe model, SB 429 proposes the establishment of a Wildfire Safety and Risk Mitigation Program under the California Department of Insurance. This program is intended to fund research that will inform the development of the new model and be utilized for formulating effective risk mitigation strategies, enhancing actuarial analyses, and improving oversight of insurance rates.
The proposal follows California’s recent endeavors to enhance its wildfire risk modeling framework. Earlier in July, the California Department of Insurance certified the Verisk Wildfire Model as the first approved model for insurance rate-setting, which has been successfully adopted in several other states. This model, developed by Verisk’s Extreme Event Solutions unit, offers valuable insights that can assist in the formulation of better insurance policies.
The American Property Casualty Insurance Association (APCIA) has expressed support for Senate Bill 429, emphasizing that advanced catastrophe models are essential for stabilizing California’s insurance market and extending coverage access for residents. However, consumer advocates, including Consumer Watchdog, have voiced concerns regarding the transparency of the new regulations and the accountability of climate model algorithms used by insurance companies.
State Senator Dave Cortese has underscored the significance of the proposed public model in supplying lawmakers with critical data to address constituents’ questions about insurance rates. These include inquiries about the rationale behind rate increases and geographical disparities in those rates. Insurance Commissioner Ricardo Lara also supports the initiative, stating it will lead to improved insurance affordability and provide insights necessary to mitigate wildfire risks effectively.
Senate Bill 429 is part of a broader legislative package targeting wildfire risks and challenges faced by the insurance market. The bill encountered minimal opposition during its legislative journey, indicating a general consensus on the need for reform. Its implementation is anticipated to increase transparency in wildfire risk assessment while offering a mechanism for oversight over private insurers’ models and the Department of Insurance’s responses.
Consumer advocates have criticized current strategies for their lack of transparency and have called for reforms to ensure that mitigation efforts are accurately represented in insurance pricing. They point to successful measures in states like Colorado as examples of effective practices that could be integrated into California’s approach. However, the passage of SB 429 does not guarantee the creation of the wildfire catastrophe model or that its findings will differ from those derived from private models utilized by insurers.
Key Features of Senate Bill 429
- Wildfire Catastrophe Model: The first public wildfire catastrophe model in the U.S.
- Risk Assessment: Expands existing risk assessments for residential properties.
- Transparency: Aims to make fire risk data available to the public.
- Funding Research: Establishes a program to fund research and develop strategies.
- Support: Backed by the APCIA while facing scrutiny from consumer advocates.
Frequently Asked Questions
What is Senate Bill 429?
Senate Bill 429 is a proposal currently under review by California Governor Gavin Newsom to establish the nation’s first public wildfire catastrophe model.
What does the bill aim to achieve?
The bill seeks to expand the state’s approach to wildfire risk assessment and insurance regulation.
Who will be responsible for public accessibility of fire risk information?
The California insurance commissioner is tasked with making fire risk information available to the public.
What are the anticipated benefits of the public model?
The model and associated research will be utilized to formulate risk mitigation strategies, inform actuarial analyses, and support oversight of insurance rates.
Who supports Senate Bill 429?
The American Property Casualty Insurance Association (APCIA) supports the legislation, stating that advanced catastrophe models are critical for stabilizing California’s insurance market and improving coverage access.
What concerns have been raised regarding the bill?
Consumer advocates, like Consumer Watchdog, have raised concerns over transparency and the accountability of the new regulations regarding climate model algorithms used by insurers.
Deeper Dive: News & Info About This Topic
- Insurance Business: California Lawmakers Considering First Public Wildfire Catastrophe Model
- Wikipedia: Wildfire
- Digin: California Moves to Build Public Wildfire Catastrophe Model
- Google Search: California wildfire catastrophe model
- Verisk: First to Complete Wildfire Catastrophe Model Review Process
Author: STAFF HERE HUNTINGTON BEACH
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