Gov. Gavin Newsom has signed a bill to improve property insurance options for landowners who have had to turn to the California FAIR plan, the state’s insurer of last resort, because of a lack of coverage after wildfires.

Senate Bill 505 by state Sen. Susan Rubio, D-Baldwin Park, will expand the insurance “clearinghouse” program within the FAIR Plan, according to the California Farm Bureau, which cosponsored the bill along with the state Department of Insurance.

The legislation will allow commercial policies under the FAIR plan to move back to the competitive market with coverage protecting farming and ranching operations, the Farm Bureau explains.

“Farmers and ranchers have truly felt the pain of California’s insurance crisis,” CFB President Jamie Johansson said when the bill passed the Senate. “Many lost their insurance after devastating California wildfires. We earlier worked with Sen. Rubio to help them gain access to coverage under the FAIR plan. Now we thank her for her leadership on SB 505, which will help those farmers and ranchers—and all Californians—gain access to affordable residential and commercial property insurance.

“Our farmers and ranchers want to focus on producing America’s food supply, not on trying to become experts in procuring what was once routine insurance coverage,” Johansson added.

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Rubio carried a bill signed in 2021 that allows agricultural properties to get fire insurance coverage under the FAIR Plan. The Farm Bureau notes that farmers suffered “a double blow” in recent years, losing crops and property to wildfires and then having insurers refuse to renew their policies.

The 2021 bill enabled farm structures such as tasting rooms and packinghouses to be insured under the FAIR plan. This bill expanded a clearinghouse that previously only listed residential policies to include commercial ones.

The Farm Bureau says more legislative fixes are needed.

Source: California Farm Bureau