Lower Costs

Natural Disaster Insurance for All

Jane is proposing a single-payer disaster insurance policy for every Californian: Natural Disaster Insurance for All. Other countries have established single-payer universal disaster insurance. For example, in New Zealand, homeowners buy policies from private insurers, but disaster coverage is provided by the state. France and Spain also have a guaranteed home disaster insurance policy.

Meanwhile, the FAIR Plan - which exists to stabilize insurers, not protect Californians - falls woefully short when it comes to actually covering Californians. It insures over six hundred thousand people, but isn’t public insurance; it’s a privately run program designed by the insurance industry to protect itself. Its coverage is limited, and it charges punishingly high premiums, leaving people underinsured.

A public, nonprofit disaster insurance system would do the opposite. Coverage would be automatic and universal. Every home would be covered automatically, and everyone would pay into the same pool. Premiums would come in two parts: one based on your home's risk, and one based on its property value. Excess capital would always come back to the community, not to shareholders or CEOs.

But the real difference is structural: a public system would address climate disaster instead of avoiding it. The private insurance business model is to avoid losses, not to reduce risk. When wildfire exposure grows, insurance companies don’t invest in fire prevention or community resilience - they pack up and leave taxpayers to foot the bill. We have socialized the costs of climate catastrophe but privatized the gains.

A public insurer would invest in prevention and resiliency, and the public would benefit with fewer claims to pay out. A state-run model could tie premiums directly to mitigation, giving homeowners clear and transparent financial incentives to harden properties and communities to invest in defensible space. It could also support low-income households with mitigation, and advance landscape-level risk reduction to better protect whole communities. A portion of the state pool could be invested in resilience infrastructure: fuel management, firefighting capacity, and early warning systems. It could require the worst corporate polluters to pay into the system, connecting the source of climate risk to its costs. And it could guarantee coverage in high-risk areas, because abandoning communities isn’t an option when you’re accountable to people instead of shareholders.

Fix the FAIR Plan

California will always need an insurer of last resort. But today's FAIR Plan leaves people underinsured and answers to the industry instead of the public. While we fight for Natural Disaster Insurance for All, Jane will use the Commissioner's power to make the FAIR Plan more transparent, accountable, and sustainable.

• Strongly enforce smoke claims. Jane will use the Commissioner’s enforcement powers to ensure smoke claims are not denied or underpaid. She will require the FAIR Plan to publish quarterly reports on how smoke claims are resolved in wildfire disaster zones, including claims filed, paid, denied, and the time each took.

• Make it accountable. The FAIR Plan should answer to the Department of Insurance and to policyholders, not to the companies that run it. She will champion legislation that adds voting public members, open board meetings and records, and require the Plan to fix the failures state examiners found.

• Make insurers pay for prevention. Insurers should not just be able to pass on the costs of wildfires to all Californians while doing nothing to reduce risk. The insurers that fund the FAIR Plan should pay an extra fee to harden FAIR Plan homes against wildfire. That way, the plan reduces risk instead of just pricing it.

Make sure premiums actually pay for claims – or lower them

Insurance companies should spend premium dollars on their intended purpose: protecting policyholders. If companies collect more than they need to cover claims and a reasonable profit, that money should go back to policyholders or be invested in statewide resilience, not huge payouts at our expense – like the $27 million salary one insurance company CEO was paid last year.

California will establish minimum loss ratio standards calculated over rolling three-year periods to account for catastrophe volatility:

• Auto insurance: 70% minimum (three-year average)

• Homeowners insurance: 65% minimum (three-year average)

Expand access to low cost auto insurance

Jane's long-term goal is to build a public auto insurance option to compete on the market for affordable car insurance. In the short term, she will expand the already existing low-cost auto insurance program to more working families.

Show how insurance companies spend your money

Californians deserve to know whether their premiums are being spent to protect us, or to pay for Super Bowl ads. As Insurance Commissioner, Jane will compile expenditure data, make it searchable online, and publish an annual "Where Your Premium Goes" report. And insurers will have to disclose whether your premiums are being invested in the fossil fuel companies driving climate disasters.

Invest in making homes and communities safer

This year, the California Department of Insurance will roll out a new Safe Homes grants program to provide funding for home hardening investments for wildfire resilience. As Insurance Commissioner, Jane will work to make this public investment as broad as possible, with permanent ongoing funding.