California Insurance Regulations August Update
September 6, 2024
Insurance Commissioner Ricardo Lara has moved forward with expanding the FAIR Plan’s commercial plan with coverage up to $20 million per building, with a total aggregate of $100 million per location. This breakthrough agreement to modernize the FAIR Plan was announced on July 26th in concept, but details needed to be worked out as contained in the FAIR Plan’s Revised Plan of Operation.
Currently, the FAIR Plan only authorizes up to $20 million per location.
“A stable and solvent FAIR Plan – established more than 50 years ago as the state’s insurer of last resort- provides important certainty for insurance consumers who otherwise cannot find insurance coverage in the traditional or surplus lines markets,” said the Commissioner’s office.
The Commissioner also outlined insurer recoupment procedures in the event of an assessment by the FAIR Plan. This bulletin provides notice of the procedure through which the FAIR Plan’s member insurers may request the Commissioner’s prior approval under Prop. 103 to seek recoupment from policyholders of any FAIR Plan assessments.
We applaud the Commissioner’s action to expand the FAIR Plan’s coverage as it will increase the stability of the FAIR Plan and provide associations with more coverage options. We acknowledge, however, that more needs to be done to address the fundamental insurance issues facing the industry. We will continue to work on additional approaches to stabilize the integrity of the insurance market for your HOA clients!
Sincerely,
Tom Freeley, CEO
Previous CDI communications about Insurance/ Insurance bill/ State Farm’s California Coverage Changes:
CDI Invitation to Workshop (March, 2024)
CDI Workshop Draft (March, 2024)
CDI Consumer Alert (March, 2024)
AB-2996 introduced by Assembly Member Alvarez
State Farm Pulls Out of California