Increase uniformity and accuracy for insurance companies in assessing fire risk for a particular property and assigning proper rates in accordance with the new guidelines.Mitigation measures reduce the risk of loss caused by wildfires.Provide incentives for individual property owners as well as fire prone communities to initiate mitigation measures in high fire risk areas.The Insurance Commissioner took notice of their pleas and stated, “With more Californians rolling up their sleeves and reaching into their own pockets to protect their homes and businesses, insurance pricing must reflect those efforts.” The Commissioner laid out the following policy reasons behind the regulations: Many consumers submitted complaints regarding this issue to the Insurance Commissioner. The result- inaccessibility of insurance for many property owners, with the more wealthy able to protect their homes despite the rising costs, and those with less resources choosing to take the gamble with no insurance. In response to this extreme risk, insurance companies have raised policy premiums in areas of high fire danger. A recent report from the United Nations found that wildfire risks are significant especially for homeowners in high fire danger areas. In recent years, the threat of wildfires has threatened Californians and others around the globe like never before. It will also require insurance companies to be more transparent about policyholders wildfire risk scores used to assess rates. These new regulations would require insurance companies to take into consideration fire mitigation measures taken by policyholders or applicants in assessing their wildfire risk number as well as premium rates. With fire season now essentially year round in some areas, insurance rates for residents and businesses have skyrocketed. On February 25, 2022, California Insurance Commissioner Ricardo Lara unveiled new regulations centered around wildfire safety.
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