New Legislation

Since the bill introduction deadline passed on February 19, PIFC Legislative Advocates are now in the process of reviewing which bills will be of interest to the insurance industry. PIFC staff believes many of the bills that have been introduced will fall by the wayside due to the limited capacity that the legislature is willing to take on because of the pandemic. We are currently watching numerous wildfire related bills that focus on homeowners’ insurance availability and affordability. Many of these bills are considered “spot bills”, meaning they are holding a place for future language. However, some of these bills are quite substantive, and PIFC staff is working to make sure any problematic bills get amended to either exclude the insurance industry or be discarded altogether. In addition to wildfire related bills, there are other bills relating to privacy, towing, and retroactive business interruption insurance that we are watching.

Below is a list of some of the bills that PIFC will be following:

  • AB 9 (Wood) Wildfires. Current law establishes various programs for the prevention and reduction of wildfires. This bill would state the intent of the Legislature to enact subsequent legislation that would increase California’s capacity to prevent and reduce the impact of wildfires and would make related findings and declarations.

Currently this bill is not much to look at. However, we are keeping a close eye on it in case future problematic language is inserted.

  • AB 52 (Frazier) California Global Warming Solutions Act of 2006: scoping plan updates: wildfires. The California Global Warming Solutions Act of 2006 authorizes the State Air Resources Board to include in its regulation of emissions of greenhouse gases the use of market-based compliance mechanisms. Current law requires all moneys, except for fines and penalties, collected by the state board from a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund (fund) and to be available upon appropriation by the Legislature. Current law continuously appropriates 35% of the annual proceeds of the fund for transit, affordable housing, and sustainable communities programs and 25% of the annual proceeds of the fund for certain components of a specified high-speed rail project. This bill would require the state board, in each scoping plan update prepared by the state board after January 1, 2022, to include, consistent with the act, recommendations for achieving the maximum technologically feasible and cost-effective reductions of emissions of greenhouse gases and black carbon from wildfires.

 

  • AB 294 (Santiago D) Vehicle Tow and Storage Act. This bill would establish the Vehicle Towing and Storage Board in the Department of Consumer Affairs and would empower the board to, among other things, regulate and resolve disputes involving vehicle towing businesses. The bill would require the board to maintain a public database on its internet website on vehicle towing businesses. The bill would require a business to obtain a Vehicle Tow and Storage Permit and pay an annual fee before operating a tow truck or tow vehicle in California. The bill would establish various penalties for violations of these provisions. The bill also would require a permit applicant or permitholder to submit specified information to the board under penalty of perjury.

PIFC is working with Assemblymember Santiago’s office to understand how exorbitant towing and storage fees that get passed onto insurers can be mitigated.

  • AB 743 (Ramos D) Insurance: business interruption: coverage for COVID-19. The California Emergency Services Act authorizes the Governor to declare a state of emergency during conditions of disaster or extreme peril to persons or property, including epidemics. Pursuant to this authority, on March 4, 2020, the Governor declared a state of emergency relating to the coronavirus 2019 (COVID-19) pandemic. This bill, with respect to a policy of insurance that provides coverage for business interruption, would create specified rebuttable presumptions affecting the burden of proof in a case in which the insured alleges that the business interruption was due to the COVID-19 pandemic and occurred during the period of the state of emergency declared by the Governor due to the COVID-19 pandemic. Specifically, the bill would create certain rebuttable presumptions that COVID-19 was present on specified property and caused physical loss or damage to that property which was the direct cause of the business interruption.

This bill is nearly identical to AB 1552 from last year. If you recall, PIFPAC had its first ever call to action to oppose this bill with great success. AB 1552 died in the Senate.

  • SB 12 (McGuire D) Local government: planning and zoning: wildfires. Current law requires that the Office of Planning and Research, among other things, coordinate with appropriate entities, including state, regional, or local agencies, to establish a clearinghouse for climate adaptation information for use by state, regional, and local entities, as provided. This bill would require the safety element, upon the next revision of the housing element or the hazard mitigation plan, on or after July 1, 2024, whichever occurs first, to be reviewed and updated as necessary to include a comprehensive retrofit strategy to reduce the risk of property loss and damage during wildfires, as specified, and would require the planning agency to submit the adopted strategy to the Office of Planning and Research for inclusion into the above-described clearinghouse.

 

  • SB 45 (Portantino D) Wildfire Prevention, Safe Drinking Water, Drought Preparation, and Flood Protection Bond Act of 2022. This bill would enact the Wildfire Prevention, Safe Drinking Water, Drought Preparation, and Flood Protection Bond Act of 2022, which, if approved by the voters, would authorize the issuance of bonds in the amount of $5,510,000,000 pursuant to the State General Obligation Bond Law to finance projects for a wildfire prevention, safe drinking water, drought preparation, and flood protection program.

 

  • SB 63 (Stern D) Fire prevention: vegetation management: public education: grants: defensible space: fire hazard severity zones: forest management. This bill would, among other things, require the Director of Forestry and Fire Protection to identify areas of the state as moderate and high fire hazard severity zones and would require a local agency to make this information available for public review and comment, as provided. By expanding the responsibility of a local agency, the bill would impose a state-mandated local program.

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