California has banned home insurers from dropping policies in areas vulnerable to the effects of wildfire risk. The new policy places a one-year moratorium preventing insurers from dropping customers in or alongside ZIP codes struck by recent wildfires.
The moratorium covers some 800,000 homes around the state. The state has also asked insurers to voluntarily stop dropping customers anywhere in California because of fire risk for one year. California’s insurance commissioner says the hold on non-renewals due to wildfire risk will give the state’s insurance market a chance to stabilize while the state looks for solutions to the wildfire problem.
Homeowners insurers lost an estimated $20 billion due to California wildfires during 2017 and 2018.
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