California Commissioner orders FAIR plan to provide increased coverage

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California Insurance Commissioner Ricardo Lara on Friday ordered the FAIR plan to offer homeowners a home insurance policy, in addition to its current home fire coverage, with more traditional features for homeowners. , such as coverage for water damage, theft and loss of use.

The order requires the FAIR Plan to submit a revised plan of operations to the California Department of Insurance within 30 days.

Spokespersons for the FAIR plan have been contacted for comment.

The order comes after the FAIR Plan Association, made up of all insurance companies eligible to be the state’s last resort property insurer, sued Lara to challenge her original November 2019 order.

A court recently upheld the commissioner’s power to demand that the FAIR plan provide more comprehensive policies for homeowners to residents in need, especially in areas at risk of forest fires in the state.

The order will give about 200,000 Californians who currently rely on the FAIR plan a more comprehensive option on top of the minimum coverage the FAIR plan currently offers, according to Lara.

He says requiring the FAIR plan to offer a more comprehensive home insurance policy will prevent consumers from having to purchase a second supplemental insurance policy to cover other risks such as homeowners’ liability. premises, water damage and theft.

These changes are in addition to previous changes that Lara successfully forced the FAIR plan to undertake last year, including increasing the combined coverage limit from $ 1.5 million to $ 3 million, providing more transparency. in their steering committee meetings and allowing CDI to participate in these meetings, and mandating the FAIR plan to seek departmental approval before returning any operating profit to participating insurers.

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