A pending measure, once thought to be bad public policy by homeowners insurers, is moving in the right direction in California, according to the American Insurance Association (AIA).
“During debate in the Senate Banking and Insurance Committee, Chair Jackie Speier (D) took amendments to improve her measure and agreed to keep working with insurers,” said Janine Gibford, AIA assistant vice president, western region. “We are encouraged by her willingness to consider the bill’s impact on homeowners insurance. AIA looks forward to continue working with Senator Speier to draft a measure to help consumers recover from major disasters.”
Senator Speier’s bill SB 2 would have required insurers to pay policy limits for contents coverage without policyholders completing property inventories. SB 2 also would have prohibited insurers from using home value calculation software. On Wednesday, Senator Speier agreed to critical amendments including removal of the controversial valuation software ban and full contents payment.
“We appreciate the difficulties homeowners face after a major catastrophe, but insurance is designed to replace what is lost. Home inventories are critical components for adjusting claims and making people whole again,” said Gibford. “The Senator accepted amendments to mandate a percentage of the policy limits and agreed to keep working with insurers, which is a great sign we can find a compromise.”
“Last year insurers worked very closely with Senator Speier and Insurance Commissioner John Garamendi (D) to develop bills that created additional policy disclosures, extended time limits to rebuild following major disasters and established a prohibition against canceling coverage following major disasters,” said Gibford.
The amendments agreed to on Wednesday will now be drafted and the Senate Banking and Insurance Committee will vote on the new version of SB 2 in two weeks.
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