Homeowner advocates applauded the move.
“What the department has announced is a solution to a crisis that the insurance industry has created,” said Amy Bach, executive director of the California-based United Policyholders, adding: “I really commend the commissioner and his staff.”
Representatives with American Property Casualty Insurance Association, a trade groups representing many of the state’s largest insurance companies, has said the industry has been hit hard by wildfire damage in recent years.
The industry group issued a press statement following the announcement that said the changes could “hurt consumer choice.”
“The FAIR Plan was never intended to replace the private insurance market. Insurance Commissioner Lara’s move to expand the FAIR Plan’s policies … could have unintended consequences, potentially contributing to a further compacting of the market and fewer choices for consumers,” the statement read in part.
In 2017 and 2018, blazes — most notably the Camp Fire in Paradise — resulted in more than 124,000 claims valued at about $26 billion in losses, according to the California Department of Insurance.
Complaints by residents in high-fire areas over losing insurance nearly doubled in the last two years and has increased by about 570 percent since 2010, according to the agency.
FAIR Plan enrollment in rural areas has increased over the last five years by more than 11,500 policies, and officials expect that number to increase dramatically when figures are tallied for 2019 early next year.
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