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<\/div>\nCalifornia Insurance Commissioner Ricardo Lara on Friday released a statement on his latest administrative action designed to address the state\u2019s homeowners insurance crisis.<\/p>\n
Lara today issued a bulletin implementing rate review reforms<\/a> he says will help stabilize the state\u2019s insurance marketplace, which includes reforms included in budget trailer language that Gov. Gavin Newsom introduced in May.<\/p>\n Newsom first made the proposal<\/a> to speed up the rate filing process while discussing the state\u2019s budget during a press conference in May.<\/p>\n Related: California Commissioner Orders Insurance Cancelation Moratorium for 185K Residents<\/a><\/strong><\/p>\n The new proposal<\/a> requires the California Department of Insurance to respond to rate requests from insurers in 120 days. If an insurer requests a rate hike on an average of more than 7%, the CDI must provide insurers with a suggested rate in 120 days.<\/p>\n Home insurance rates are on the rise, and availability has also become a concern, as many insurers are pulling back from the wildfire prone state. Proposed solutions to the crisis have included finding ways to expedite rate filings, enabling insurers to use reinsurance rates in filings, as well as enabling them to use catastrophe modeling<\/a> to set rates.<\/p>\n Related: California\u2019s Park Fire Continues to Slowly Grow to 647 Square Miles<\/a><\/strong><\/p>\n Many of these proposals indicate a growing interest in making a change to Proposition 103<\/a>, the 1988 voter-approved law that requires prior approval from the California Department of Insurance before implementing property\/casualty insurance rates.<\/p>\n Lara\u2019s bulletin under his existing Prop 103 authority to help the CDI conduct a rigorous and transparent review of rate change applications within the current 60-day timeline prescribed under Prop. 103. The CDI seeks to increase the transparency and speed of rate change application review and approval times in ways that are beneficial to consumers, the Department, and the insurance market. Also, as part of this reform, the CDI plants to create a \u201cdata reconciliation tool\u201d as a check that insurance companies must complete upon submitting their rate applications to the department for review.<\/p>\n \u201cConsumers benefit from a thorough and transparent rate review with more insurance products and greater availability of coverage,\u201d Lara said in a statement. \u201cToday, I am strengthening my Department\u2019s ability to enforce timelines set more than 30 years ago under Proposition 103. Reducing unnecessary delays is critical to getting our state\u2019s insurance marketplace back on track.\u201d<\/p>\n He added: \u201cConsumers are hurting, businesses continue to lose coverage, wildfires are ravaging our state\u2014and we do not have the luxury of time. I am ultimately responsible for fixing this crisis, and I am moving forward to meet my commitment to complete long-needed reforms this year.\u201d<\/p>\n Top photo: Park Fire in California. Source: CalFire.<\/em><\/p>\n Topics<\/span> California<\/a> <\/p>\n<\/p><\/div>\n Was this article valuable?<\/p>\n<\/p><\/div>\n