GOOD MORNING EVERY SPONSOR THE
COVERT NINETEEN EMERGENCY AND
TO PROTECT THE PUBLIC
LEGISLATORS AND EMPLOYEES WE
MUST LIMIT NONESSENTIAL
GATHERINGS AND ADHERE TO SOCIAL
DISTANCING AND FACE COVERING
GUIDELINES THANK WITH THOSE
ORDERS THE SENATE HOUSE MAKE
NECESSARY ADJUSTMENTS TO NORMAL
PRACTICES IN ORDER TO ENSURE
THAT THE PUBLIC CONTINUES TO
HAVE ACCESS TO THE LEGISLATIVE
PROCESS WE ARE HOLDING OUR
COMMITTEE HEARING IN THE
CAPITOL AND THE SENATE CHAMBERS
HERE WITH ME TODAY ARE VICE
CHAIR JONES SENATORS ARCHULETA
BATES DODD. WESSEL FOR TITLE
AND MELENDEZ BORJAS AND ROTH.
WE ALSO HAVE REPRESENTATIVES
FROM THE DEPARTMENT OF
INSURANCE THE INSURANCE
INDUSTRY SECONDARY INSURANCE
MARKET AGENTS BROKERS BIG UC
COOPERATIVE EXTENSION AND THE
FARM BUREAU WHO ARE
PARTICIPATING REMOTELY. FOR
EVERY MORE PARTICIPANTS PLEASE
MUTE YOUR PHONES OR COMPUTERS
THIS WILL GREATLY AID IN
ELIMINATED ANY ACOUSTIC
FEEDBACK. I ASK THAT EVERY TIME
YOU WISH TO BE RECOGNIZED THAT
YOU USED TO RAISE YOUR HAND
FEATURE IN THE PROGRAM. EACH
TIME YOU ARE RECOGNIZED TO
SPEAK A POP UP WINDOW WILL
pTO UN MUTE PLEASE SELECT UNMUTE
BEFORE YOU BEGIN SPEAKING. OUR
IT PERSONNEL WILL PUT YOU BACK
ON MUTE WHEN YOU ARE DONE ONCE
RECOGNIZED TO SPEAK PLEASE MAKE
SURE YOU CAN BE SEEN ON THE
SCREEN STATE YOUR NAME AND THEN
YOU'RE READY TO ADDRESS THE
COMMITTEE. TO ALLOW THE PUBLIC
ACCESS WE HAVE ADMITTED MEMBERS
OF THE PUBLIC TO TWO HEARING
ROOMS. TO THE EXTENT THAT
SOCIAL DISTANCING. REQUIREMENTS
ALLOW AND WILL BE USING A
TELECONFERENCE ARE BEST FOR
THOSE INDIVIDUALS WHO WISH TO
TESTIFY TODAY. FOR ALL
INDIVIDUALS WISHING TO PROVIDE
PUBLIC COMMENT THE PARTICIPANT
TOLL FREE NUMBER AND ACCESS
CODE IS POSTED ON OUR COULDN'T
COMMITTEE WEBSITE AND IT WILL
BE DISPLAYED ON THE SCREEN. I
WILL ANNOUNCE IT NOW. TODAY'S
PARTICIPANT NUMBER IS.
844-291-6364 AND THE ACCESS
CODE IS. EIGHT SEVEN SIX EIGHT
NINE FOUR ONE. ONCE AGAIN.
ACCESS CODE IS. EIGHT SEVEN SIX
EIGHT NINE FOUR ONE. FOR
DETAILED INSTRUCTIONS ON HOW
THE TELECONFERENCE SYSTEM WORKS
PLEASE SEE THE SENATE N. OR
COMMITTEE WEBSITE. FOR TODAY'S
HEARING WE WILL BE HEARING ALL
OF THE PANELS OF WITNESSES ON
THE AGENDA PRIOR TO TAKING ANY
PUBLIC COMMENTS. ONCE WE'VE
HEARD ALL OF THE WITNESSES WE
WILL HAVE A PUBLIC COMMENT
PERIOD FOR THOSE WHO WISH TO
COMMENT ON THE TOPICS ON
TODAY'S AGENDA. PLEASE NOTE
THAT IN ORDER FOR US TO HEAR
YOU CLEARLY AND TO AVOID
ACOUSTIC FEEDBACK. YOU MUST
MUTE THE DEVICE YOU'RE WATCHING
THE HEARING ON PRIOR TO GIVING
TESTIMONY OVER THE PHONE. IT IS
IMPORTANT THAT WE HEAR FROM YOU
AND WE THANK YOU FOR YOUR
PATIENCE. I WILL MAINTAIN
DECORUM DURING THE HEARING AS
IS CUSTOMARY AND ANY INDIVIDUAL
WHO IS DISRUPTIVE MAY BE
REMOVED FROM THE REMOTE.
MEETING SERVICE OR HAVE THEIR
CONNECTIONS MUTINIES. WHILE
EVERY EFFORT HAS BEEN MADE TO
STREAMLINE THE HEARING PROCESS
AND CONDUCTOR HEARINGS IN AS
CLOSE TO THE SAME MANNER AS IS
CUSTOMARY. THERE MAY BE SOME
LAG TIME FOR PARTICIPANTS WERE
ADJUSTING TO NEW. TECHNOLOGIES
PLEASE BE RESPECTFUL AND
PATIENT SO THAT ALL INTERESTED
PARTIES. CAN BE HEARD.
THANK
YOU FOR JOINING THE SENATE
INSURANCE COMMITTEE
INFORMATIONAL HEARING TODAY. I
WOULD FIRST LIKE TO THANK THE
PANELISTS FOR TAKING THE TIME
TO JOIN US HERE TODAY. I HOPE
THAT DESPITE OUR PHYSICAL
SEPARATION WERE ABLE TO HAVE A
ROBUST AND PRODUCTIVE
CONVERSATION AND LOOK FORWARD
TO FOLLOWING UP WITH EACH AND
EVERYONE OF YOU IN PERSON. IN
THE NEAR FUTURE THE PURPOSE OF
TODAY'S HEARING IS TO GATHER
INFORMATION FROM A BROAD
VARIETY OF STAKE HOLDERS. ON
THE GENERAL STATE OF THE STATE
OF THE HOMEOWNERS AND
COMMERCIAL MARKET. AND HONE IN
ON SEVERAL SPECIFIC WELFARE
RELATED ISSUES. AFFECTING
CONSUMERS THAT HAVE SURFACED IN
RECENT MONTHS. WITH FOUR POINT
THREE MILLION ACRES BURNED THE
TWENTY TWENTY WILDFIRE SEASON.
WAS THE LARGEST MODERN THE
RECORDED IN ACCOUNTS FOR FIVE
OF THE TOP TWENTY LARGEST
WILDFIRES IN CALIFORNIA HISTORY.
TRAGICALLY OVER TEN THOUSAND
STRUCTURES WERE DESTROYED. AND
THIRTY ONE PEOPLE KILLED.
DURING THE TWENTY SEVENTEEN
TWENTY EIGHTEEN WILDFIRE SEASON
UTILITY COSTS BARS WERE CENTER
STAGE CAUSING DEVASTATING FIRES
THAT BROKE RECORDS. LAST AUGUST
LIGHTNING STRIKES EXPOSE
DIFFERENT WEAKNESS. THE
HUNDREDS OF FIRES STARTED BY
LIGHTNING STORMS EVENTUALLY
BECAME THE AUGUST COMPLEX FIRE.
BRINGING OVER ONE MILLION ACRES
ACROSS SIX COUNTIES. ANOTHER
LINING COMPLEX FIRE BFE YOU
BURNED FOUR HUNDRED THOUSAND
ACRES BECOMING THE THIRD
LARGEST IN STATE HISTORY.
ACCORDING TO ESTIMATES FROM A
ON. TWO MORE LINING COMPLEX
FIRES THE L. IN YOU AND THAT'S
EASY YOU EACH COSTS AT LEAST
TWO BILLION IN INSURED LOSSES.
THE GLASS SPIRE WHICH CAUSES
STILL UNDER INVESTIGATION COST
ANOTHER TWO POINT NINE BILLION
IN LOSSES. AS CAN BE EXPECTED
AFTER TRAGEDIES OF THIS
MAGNITUDE OCCUR THE COMMITTEE
HAS BECOME AWARE OF SEVERAL
COMPLAINTS REGARDING THE
AVAILABILITY OF INSURANCE WHERE
WILDFIRE RISK IS A CONCERN.
WHAT IS DIFFERENT THIS TIME
THAN IN PREVIOUS YEARS. IS THE
MANY COMPLAINTS THAT HAVE COME
TO MY ATTENTION FROM BUSINESSES
INSTEAD OF PRIMARY HOMEOWNERS.
UNTIL RECENTLY COMMERCIAL
INSURANCE AVAILABILITY DID NOT
SEEM TO HAVE BEEN IMPACTED BY
RECENT WILDFIRES AS HOMEOWNER
LINES. HOWEVER NOW IMPACTED AND
VOICING CONCERNS INCLUDE FARMS
RANCHES AND VINEYARDS TIMBER
INDUSTRY PRESCRIBER NURSE
HOMEBUILDERS CAMPGROUND
OPERATORS AMONG OTHERS. IN SOME
INSTANCES THE AVAILABILITY
CONCERNS IS FOR PROPERTY
COVERAGE AND IN OTHERS ITS
LIABILITY. IN ALL CASES IT IS
MY HOPE. THAT THE DISCUSSION
AND HEARING HERE TODAY LEAVES
US ALL WITH A BETTER
UNDERSTANDING ON HOW. WE CAN
TACKLE THIS ONGOING CRISIS.
THAT IS IMPACTING ALL OF OUR
CONSTITUENTS AND WHAT CAN'T
WHAT CAN WE DO TO HELP THEM.
RIGHT NOW IN CALIFORNIA THERE
IS HARDLY ANY AREA LAUGH NOT
TOUCHED BY THE IMPACTS OF
WILDFIRES. ON A POSITIVE NOTE
AND TO MUCH ANTICIPATION. THE
DEPARTMENT OF INSURANCE HAS
RECENTLY RELEASED A DRAFT
REGULATIONS REGARDING THE USE
OF MODELING AND RATEMAKING AND
ANNOUNCED A PARTNERSHIP TO
CREATE STATE HOME A COMMUNITY
HARD ANY RECOMMENDATIONS. FOR
SEVERAL YEARS THE COMMITTEE HAS
DISCUSSED THE ROLE OF COMPUTER
COMPUTER RISK MODELS IN
UNDERWRITING DECISIONS AND WHAT
ROLE THEY MIGHT PLAY AND
RATEMAKING. THAT CONTINUED
PRODUCTIVE CONVERSATION FROM
STAKEHOLDERS IS WELCOME. AS IT
IS AN INCREDIBLY COMPLEX
UNDERTAKING SINCE THE
REGULATIONS ARE SO NEW WE WON'T
TAKE FOCUS ON THEM HERE TODAY
BUT LOOKING FORWARD TO HAVING A
FULLER CONVERSATION ON THEM AT
A LATER DATE I PERSONALLY WANT
TO THANK THE INSURANCE
COMMISSIONER FOR TAKING THE
TIME TO BRIEF ME. PRIVATELY
BEFORE WE BEGIN WITH OUR
SPEAKERS I WOULD LIKE TO INVITE
THE PUBLIC WANTING TO
PARTICIPATE TO CALL IN NOW.
PLEASE DIAL THIS TOLL FREE
NUMBER. EIGHT FOUR FOUR TWO
NINE ONE SIX THREE SIX FOUR
WHEN PROMPTED PLEASE USE THE
ACCESS CODE GIVEN. EIGHT SEVEN
SIX EIGHT NINE FOUR ONE. OUR
FIRST PANEL HERE TODAY WILL
CONSIST OF MICHAEL MARTINEZ
FROM THE DEPARTMENT OF
INSURANCE AND MARK SECTION
REPRESENTING THE AMERICAN
PROPERTY CASUALTY INSURANCE
ASSOCIATION. WELCOME MISTER
MARTINEZ AND THANK YOU FOR
JOINING US HERE TODAY- AND
PLEASE PROCEED WHEN YOU'RE
READY. GOOD MORNING THANK YOU
CHAIR RUBIO AND MEMBERS OF THE
COMMITTEE MIKE MARTINEZ. SENIOR
DEPUTY COMMISSIONER LEGISLATIVE
DIRECTOR OF THE CALIFORNIA
DEPARTMENT OF INSURANCE HERE ON
BEHALF OF INSURANCE
COMMISSIONER RICARDO LARA I'M
ALSO JOINED HERE VIRTUALLY WITH
MY COLLEAGUE BRIAN TENLEY.
SERVES AS DEPUTY COMMISSIONER
OF SPECIAL COUNSEL TO INSURANCE
COMMISSIONER TO HELP ANSWER ANY
TECHNICAL QUESTIONS AT THE END
OF THIS TUNNEL. AND SO THE
ABSENCE TURNS COMMITTEE HAVE
ASKED THE DEPARTMENT FOR OUR
PERSPECTIVE REGARDING EMERGING
ISSUES AND COMMERCIAL INSURANCE
SPACE GIVING OUR STATE'S
ONGOING WILDFIRES. AND I REALLY
DO APPRECIATE THE OPENING
REMARKS FROM. THE SHARE. OF WE
DO LOOK FORWARD AFTER
COMMISSIONER DOES LOOK FORWARD
TO CONTINUING TO HAVE A
DIALOGUE WITH YOU AND ALL
MEMBERS HAS LOST ALL
STAKEHOLDERS AND BE A
TREMENDOUS AMOUNT OF ACTIVITY
AND ADMINISTRATIVE SPACE THAT-
HE HAS BEEN ENGAGED IN THESE
LAST SEVERAL MONTHS. MY HIGH%
LEVEL REMARKS WILL TOUCH ON THE
GROWING EFFECTIVE WILDFIRES ON
THE AVAILABILITY. AFFORDABILITY
AND RELIABILITY ISSUE FOR
COMMERCIAL INSURANCE ACROSS OUR
STATE AFFECTING A VARIETY OF
DIFFERENT INDUSTRIES AND
BUSINESSES. AND INITIAL
THOUGHTS AND WAYS TO HELP
ADDRESS THIS GROWING ISSUE. SO
FIRST OF ALL I WANTED TO JUST
PROVIDE A LITTLE PRIMER A
LITTLE A BRIEF BRIEF BACKGROUND
OF THE DEPARTMENTS REGULATORY
AUTHORITY IN COMMERCIAL
INSURANCE STATUS. SINCE
NINETEEN EIGHTY EIGHT
PROPOSITION ONE OF THREE HAS
REQUIRED PRIOR APPROVAL OF
COMMERCIAL INSURANCE RATES BY
THE DEPARTMENT INSURANCE
COMMISSIONER. IS RATES CANNOT
BE EXCESSIVE. AND ADEQUATE
UNFAIRLY DISCRIMINATORY OR
OTHERWISE IN VIOLATION
PROPOSITION ONE OF THREE. THE
INSURANCE COMMISSIONER
REGULATES THESE RATES THESE
COMMERCIAL INSURANCE RATES BUT
CANNOT REQUIRE INSURANCE
COMPANIES TO SELL AND MARSHALL
INSURANCE TO ANY GIVEN POLICY
FOLDER. IN OTHER WORDS THE
INSURANCE COMMISSIONER CANNOT
COMPEL AN INSURANCE COMPANY TO
WRITE IN A CERTAIN PART OF THE
STATE OR CONTINUE TO WRITE A
PARTICULAR BUSINESS SECTOR AS
LONG AS THE ACTION BY THE
INSURANCE COMPANY JUST TO JUST
CONTINUE WRITING. IS NOT
UNFAIRLY DISCRIMINATORY WHICH
CAN BE DETERMIED FURTHER
THROUGH ITS UNDERWRITING
GUIDELINES. ALSO YOU'VE HEARD-
DISCUSSED YOU YEARS. HE
INSURANCE COMMISSIONER A
MEASURE THAT HE HAD AUTHORED
BACK IN TWENTY EIGHTEEN AS A AS
A STATE SENATOR S. C. H. U.
FOR. DANCE THAT THE INSURANCE
COMMISSIONER HAS ISSUED
MANDATORY ONE YEAR MORATORIUM
SO WHENEVER GOVERNOR DECLARES
AN EMERGENCY AND THE SYSTEMIC
CONTEXT THE WILDFIRES- HOWEVER
HE DOES NOT HAVE THAT SIMILAR
STATUTORY AUTHORITY TO ISSUE. A
SIMILAR MORATORIUM FOR
COMMERCIAL POLICIES AND
COMMERCIAL- POLICYHOLDERS
UNLIKE AS HE DOES AND HAS IN
THE RESIDENTIAL PROPERTY
INSURANCE SPACE. SO THEREFORE
RELATED I'M COMMERCIAL
INSURANCE COMPANIES CANNOT
RENEW I WILL IMMEDIATELY AFTER
WILDFIRE AND BECAUSE INSURERS
ARE NOT OBLIGATED TO WRITE IN
THE WE ARE THE WILDLAND URBAN
INTERFACE SOME INSURANCE
COMPANIES MAY PREFER TO AVOID
RESTORING ON RENEWING RATHER
THAN PROPERLY PRICING RESTS IN
THE MOVIE. A REGARDING THE
MORATORIUMS. I'M SURE THAT YOU
ALL HAVE HEARD THAT HE- THE
COMMISSIONER HAS ISSUED A
HANDFUL OF ONE YEAR MORATORIUM
SO MANY TOWARD MORE AND MORE
TORRANCE AND THE- PERSONAL
HOMEOWNER SPACE. LAST FALL
WHICH TO DATE IS MARCH FORUMS
COLLECTIVELY COVER MORE THAN
TWO POINT FOUR MILLION POLICY
HOLDERS STATEWIDE MORE THAN 18%
OF THE STATE'S PRESIDENTIAL
INSURANCE MARKETS. SO WHAT IS
THE DEPARTMENT NO AT THIS POINT
IN TIME REGARDING COMMERCIAL
INSURANCE AVAILABILITY. READ
THE DEPARTMENT MOSTLY HAVE
ANECDOTAL EVIDENCE TO DATE
VERSES OUR CORNER BONTA BIBLE
DATA. HOWEVER WE DO HAVE SOME
DATA TO SHARE. ACCORDING TO OUR
LATEST REPORTING IN TWENTY
NINETEEN AGRIBUSINESS.
ACCOUNTED FOR HUNDREDS OF
MILLIONS AND WRITTEN PREMIUMS
SPENDING ACROSS SEVERAL
CATEGORIES INCLUDING FARM
OWNERS COMMERCIAL MULTI PERIL
COMMERCIAL LIABILITY AND ALLIED
LINES. AS OF TWENTY NINETEEN
NATIONWIDE AGRIBUSINESS
INSURANCE COMPANY THE LARGEST
WRITER OF AGRIBUSINESS RISKS IN
THE COUNTRY RIGHTS
APPROXIMATELY HALF OF THE
CALIFORNIA MARKET. FROM TWENTY
TEN TO TWENTY TWENTY. HARTMAN
APPROVED APPROXIMATELY ONE
HUNDRED AND SIXTY SIX
AGRIBUSINESS RELATED RATE
APPLICATIONS REPRESENTING FIFTY
SIX UNIQUE ADMITTED INSURERS.
WE ARE STILL RESEARCHING HOW
MANY ADMITTED INSURERS ARE
CURRENTLY STILL WRITING
POLICIES IN THIS SPACE BUT ONLY
TWENTY SIX OF THE ONE HUNDRED
SIXTY SIX RATE APPLICATIONS
THAT I MENTIONED WERE APPROVED
BETWEEN TWENTY EIGHTEEN TO
TWENTY TWENTY INDICATING
PERHAPS THE SHRINKAGE IN THE
MARKET. THE DEPARTMENT'S MARKET
SHARE REPORT SHOWED THAT IN
TWENTY SEVENTEEN INCURRED LOSS
RATIO WHICH IS A MEASURE OF HOW
MUCH OF EACH PREMIUM DOLLAR IS
IN TURN SENT TO PAY CLAIMS. OF
FOR FARM OWNERS POLICIES WAS
TWO HUNDRED AND TWENTY FIVE
PERCENT. ALTHOUGH IT HAS
DECLINED SOMEWHAT IT REMAINS
RELATIVELY HIGH IN TWENTY
EIGHTEEN AND TWENTY NINETEEN.
SAYS SUGGESTING COMMERCIAL
INSURANCE COMPANIES CONTINUE TO
PAY A SIGNIFICANT AMOUNT ON
CLAIMS WHEN COMPARED TO THE
PREMIUM DOLLAR STUFF THEY
ACTUALLY COLLECT. SOURCE ONE
CAN ARGUE THAT THIS MAKES OF
THIS OF THE COMMERCIAL MARKET
LESS DESIRABLE- TO INSURERS. SO
WHAT DOES THIS THIS APPARENT
HARDENING OF THE INCH OF THE
COMMERCIAL MARKET PLACE MEANS
IN OTHER WORDS WHAT ARE THE
FACTORS FOR WHY WE'RE SEEING
THIS YEAR TODAY. THE DEPARTMENT
HAS SEEN THESE PAST COUPLE OF
MONTHS THAT ARE CONTRIBUTING TO
THIS HARDENING COMMERCIAL
MARKET. IT'S INCLUDED FACTORS
SUCH AS CATASTROPHIC EVENTS IN
GLOBAL MARKETS CLEARLY THE
GLOBAL PANDEMIC THAT REGION
SENIOR TO LIVE AND UNDER. OUR
STUDENTS THROUGHOUT THE COUNTRY
AND WORLD IN FACT- IS CONTINUES
TO EXACERBATE THE AVAILABILITY
OF INSURANCE AND REINSURANCE-
IN OUR STATE NATION AND- WORLD.
SO THE CONTINUED GLOBAL
PANDEMIC R. R. SEVERAL YEARS
THE WILDFIRES. HURRICANES IN
THE SOUTHEAST FLOODING IN THE
MIDWEST NORTHEASTERN STORMS
BUYING WITH INCREASED CLAIMS
ACTIVITY ALL OF THAT- IS REALLY
AGAIN EXACERBATING WE BELIEVE-
AND CONTINUES TO BE A MAJOR
FACTOR IN AVAILABILITY.
ECONOMIC DOWNTURN UNCERTAINTY
IN THE MARKET- FINANCIAL MARKET
VOLATILITY ESPECIALLY WITH THE
CONTINUED GLOBAL EPIDEMIC
CONTINUES TO BE A FACTOR THAT
WE SEE. SHRINKING INSURANCE
CAPITAL DECREASED COMPETITION
AVAILABILITY AND AFFORDABILITY
OF REINSURANCE ALSO IS A FACTOR
AND THEN WE HEAR AT ALL THESE
FACTORS. CONVERGING AT THE SAME
TIME AGAIN IT REALLY DOES- SIR
TO BE A YEAR- IT'S JUST A
PERFECT STORM IN REGARDS TO THE
AVAILABILITY OF COMMERCIAL
INSURANCE IN THE MARKET AND
AGAIN I KNOW WE WILL HEAR FROM
US SEVERAL IN INSURANCE
REPRESENTATIVES WHO. WILL
LIKELY. REITERATE WHAT I'M
SAYING HERE TODAY. I WOULD SAY
THAT- AS A GENERAL REMINDER
THAT- SURPLUS LINES INSURERS
ARE NOT SUBJECT TO PROPOSITION
ONE OF THREE AND IT'S PRETTY
PROTECTION RULES BUT THEY DO
SERVE A PURPOSE. FOR IF AND
WHEN IT- INDIVIDUALS AND DID IT
IN LINE- I'M SURE IS IN THE
ADMITTED LYING OR NOT ABLE TO
PROVIDE. ADEQUATE PRODUCTS TO
CALIFORNIA BUSINESSES DURING
THIS TIME SO DID SURPLUS LINES
IS A J. A COMPETITIVE. PLAYER
IN THE COMMERCIAL MARKET PLACE
THE FAIR PLAN IS. ALSO CAN BE.
THE AS A PLAYER THE STATE AS
WELL. YET I WOULD KNOW THAT
THEY MAY NOT BE A VIABLE LONG
TERM BACKSTOPS FOR MOST
BUSINESSES DO TO THE FAIR PLANS
RELATIVELY LOW POLICY LIMIT OF
THREE POINT SIX MILLION DOLLARS
IN AGGREGATE- ALL COVERAGES
COMBINED AND THEN WHEN YOU LOOK
AT MOST COMMERCIAL ENTITIES
THEY WOULD NEED COVERAGE IN THE
TENS OF MILLIONS. OR HUNDREDS
OF MILLIONS OF DOLLARS AND SO-
IT'S JUST THE FAIR PLAN MAY NOT
BE AS VIABLE AS A BACKSTOP. AS
WELL AS THE FAIR PLAN COVERAGE
THEY DO HAVE LIMITED. SCOPE IN
BOTH- IN TERMS OF TYPES OF
COMMERCIAL POLICY SOLD AND
COVERAGE LIMITS. WE HAVE FOR
EXAMPLE THREE MILLION OR
STRUCTURES AND ONE POINT FIVE
MILLION FOR ALL OTHER I
COVERAGE SPEECHES WRITTEN BUT
BASS- IN AREAS OF. OF- I WAS-
WHAT WERE THE CAN ONLY SOME BY
THE FAIR PLAN. SO NEXT IS JUST
WHAT HAS THE DEPARTMENT OF
INSURANCE HURT WE HAVE HELD
CONVERSATIONS CONVERSATIONS
WITH A VARIETY OF STAKEHOLDERS-
RANGING FROM. AGRIBUSINESS THE
TIMBER INDUSTRY FARMS AND
WINERIES AND DINNERS BROKERS
AND PRODUCERS AMONG MANY OTHERS
SHE REALLY PROVIDE A FULLER
PICTURE OF HOW WILDFIRES HAVE
AFFECTED THEIR ABILITY TO KEEP
AND MAINTAIN COMMERCIAL
INSURANCE. AND THOSE
CONVERSATIONS ABOUT HAVE AN
IMPACT IN VERY LIMITED THEY
HAVE IN FACT ALSO THAN THE LAST
HANDFUL OF MONTHS. AND WE DO
REALLY DO APPRECIATE. HEARING
DIRECTLY ONTHE GROUND FROM A
VARIETY OF THESE ENTITIES AND A
LOT OF IT- IT RANGES FROM. THE
FROM INCREASE AND WHAT THEY'RE
PAYING THE PREMIUMS GOING FROM
DOUBLES TO TRIPLE THE AMOUNT
FOR EXAMPLE ONE BUSINESS. AT
ITS RATES DOUBLE AND POLICY
LIMITS DECREASED- FROM ONE
HUNDRED MILLION TO NOW FIFTY
MILLION LEAVING THEM EXPOSED
FOR YOUNG COVERED A FIFTY
MILLION DOLLARS FOR HAVING TO
GO BACK OUT. TO OTHER PLAYERS
IN THE MARKET TO FIND OR
STACKED. COVERAGE AND SO WE'RE
SEEING A HEARING FROM THE SO.
OF REDUCTION IN THE ABILITY OF
SUGGEST COVERAGE. AND THE
COVERAGE ISABEL JANET STUFF OR
TRIPLE AND- GEN. TWENTY YOU
HAVE A PROXY TWO MINUTES THANK
YOU OKAY NO THANK YOU THANK
YOU- MADAM CHAIR. SO WHAT I CAN
AND THEN IF YOU WANNA JUST JUMP
TO AND LOOKING AHEAD I DO WANT
TO- STATE TAX. SO IN ADDITION
TO AFFECTED. BUSINESSES GOING
BACK OUT TO- TO LOOK OUT FOR. A
PAYING. LOOKING AT RISK THE
COVERAGE LEVEL OR LARGER
DEDUCTIBLE- WE ALSO- THE
ENGINES ALL A LARGELY DEPENDENT.
THE DEPARTMENT IS ITS OUT OF
CALL IN ORDER TO GATHER
NECESSARY DATA FROM COMMERCIAL
INSURANCE COMPANIES WE FEEL
THAT THIS INFORMATION BE
HELPFUL TO DETERMINE THE EXTENT
OF COMMERCIAL INSURANCE
INITIATIVE NON RENEWALS AND THE
IMPACT OF THE HARDING OF THE
COMMERCIAL INSURANCE MARKET
PLACE. WORD FROM AT THE
ANECDOTAL ACTUALLY THE HARD
DATA IS TO BE THE FIRST EVER.
COMMERCIAL INSURANCE DATA CALL
AS IT RELATES TO WILDFIRES THAT
WE WILL BE INITIATED IN THE
NEXT HANDFUL OF WEEKS- I THINK
YOU. SHOULD RUBIO FOR TALKING
ABOUT THE- USE THE MODELING AND
RATE MAKING THAT IS ONE OTHER
COMPONENT THAT THE
COMMISSIONERS LOOKING AT TO
TACKLE THE IN COMMERCIAL
INSURANCE- AVAILABILITY. THE
COMMISSIONERS ALSO PARTNERED
WITH THE GOVERNOR
ADMINISTRATION ON A- HARD. NAME
COMMITTEE AND HOME HARDING
STAND FOREIGN. AS WELL AS I
WANTED TO IT IN IN CLOSELY. IS
THAT TO THE CHAIRS BILL ELEVEN.
BACK TO THREE AMENDED TAKES THE
DEFINITION OF BASIC PROPERTY.
TO EXCLUDE HER CROPPERS OR THE
PURPOSE OF RIGHT A FAIR POLICY.
THE DEPARTMENT IS STILL
REVIEWING BILL BUT WE GENERALLY
SUPPORT OF OTHER CONCEPT PLAN
THAT. ARM REST OR ELSE FOR
COVER UNDER PLAN. WHERE TAX AND
PRESCRIBED BURNING TALKING WITH
CALIFORNIA AIR RESOURCES BOARD.
ON A THE ISSUE FOR TO HAVE DUTY
ENERGY TRUCKS FOR HAPPENED AND
QUESTIONS ON THAT. SO WITH THAT
BEING SAID I CONCLUDE MY AND
LOOK ANSWER QUESTION WITH MY
COLLEAGUES. THANK YOU. THANK
YOU MISTER TINA I WILL. GO TO
MARS. REPRESENTING THE AMERICAN
PROPERTY CASUAL INSURER ITSELF.
AND THEY WILL TAKE FROM. MISTER
SECOND. MORE MADAM CHAIR MEMBER
OF THE CAN- THIS IS SOUND BUT I
REALLY WAY I WAS THERE SO IN
THE HOT SEAT NEXT TO AND OF THE
COMMITTEE MY NAME IS MARK
SECOND THEN I'M VICE STATE
RELATES FOR THE PROPERTY CASH
INSURANCE. A. B. C. I. A. A
MASS TRADE MEMBERS ABOUT SO 5%
OF THE COMMERCIAL INSURANCE IN
THIS DAY TO GET COULD BE BOTH
IT MAY ANSWER LINES CARRIERS
APPEARED BEFORE THIS COMMITTEE
SO TIMES LAST YEARS WILDFIRE
AND THE IMPACTS OF GERMANS OF
THESE PRESENT UP ON PROPERTIES
WELL TODAY I WILL BE ON
COMMERCIAL IN THE OF PRESCRIBED
BURNS AS FORCE. TO
POLICYHOLDERS HEARD ABOUT HIS
IN OUR- MARKET FOR YOU. THE
COMPLAINTS ABOUT CA ISSUES ONCE
MORE MARKET DUE TO. ARE
RELATIVELY NEW. AS A- KNOWLEDGE
GENERAL STATE. AS WE HAVE JUST
BEFORE TWENTY. WAS A SOME YEAR
A WHILE FOR. MAJOR WILDFIRE. SO
THE GRANT BLANK WITH REGARD TO
THE RESIDENTIAL INSURANCE
MARKETS HOWEVER THE COMMERCIAL
MARKET HAS ALSO BEEN HEAVILY
IMPACTED. BY MANY YEARS OF
DROUGHTAN AGGRESSIVE EXPANSION
NEW COMMUNITIES BUILT IN THE
WILDLAND URBAN INTERFACE.
NUMEROUS HOMES AND BUSINESSES
ARE NOW AT RISK EACH YEAR.
THESE LARGE WIND BROWN FIRES
BURNED THROUGH ENTIRE TOWNS
NUMBERS CONSUMER COMMERCIAL
PROPERTIES WERE LOST ONE SIDE
HOMES. FOR EXAMPLE IN TWENTY
EIGHTEEN THE CAPITALS LIKE CAR
FIRES COMBINE DESTROYED
APPROXIMATELY FORTY FOUR
HUNDRED STRUCTURES. OF THESE
APPROXIMATE SIXTEEN HUNDRED
WORK COMMERCIAL STRUCTURES ARE
JUST OVER ONE THIRD. THERE WAS
A FIRE IN MALIBU IN THE
CAMPFIRE PARADISE DIGITALER SAW
SUBSTANTIAL COMMERCIAL
PROPERTIES LOST. 55% AND 41% OF
DESTROYED STRUCTURES BEING
COMMERCIAL RESPECTFULLY. THE
DEVASTATION SEEN IN WILDFIRES
IN CALIFORNIA FORTUNE NOT
ISOLATED RECORD WILDFIRES WERE
EXPERIENCE IN TWENTY TWENTY
MULTIPLE WESTERN STATES
INCLUDING OREGON. AND COLORADO
AS WELL AS GLOBALLY. OVERSEAS
THERE ARE THREE TIMES MORE
WILDFIRES AND USUAL IN PORTUGAL
AND SPAIN IN TWENTY SEVENTEEN
TO TWENTY TWENTY. BUSH FIRED
ALL OVER AUSTRALIA CAN
CENTENARY EQUAL TO VERMONT AND
NEW HAMPSHIRE COMBINED. LOSSES
DUE TO WILDFIRES HAVE BECOME A
GLOBAL PROBLEM BUT IS EXPECTED
TO BECOM WORSE. TWENTY TWENTY
PRESENTED ADDITIONAL UNIQUE
CHALLENGES IN THE PROPERTY
INDUSTRY ASIDE FROM THE RECORD
TWENTY TWO BILLION DOLLAR
WEATHER AND CLIMATE RELATED
CATASTROPHES THE U. S. MARKET
CAP INTEREST IN SUBSTANTIAL
IMPACTS FROM RECORD BREAKING
LOSSES DUE TO SOMEONE RESTON
TWENTY TWENTY. AS WELL AS
IMPACTS FROM COVER NINETEEN
INCLUDING A SURGE IN HOME
REMODELING PROJECTS AS WELL AS
DISRUPTIONS TO MANUFACTURE AND
SUPPLY CHAINS. THE DEMAND FOR
CONSTRUCTION MATERIALS AND
LABOR AS MANY HOMEOWNERS AND
BUSINESSES ARE TRYING TO
REBUILD FROM THESE EVENTS. AS
ADDED SIGNIFICANT PRESSURES
REPORTED SHORTAGES OF LUMBER
AND OTHER CHALLENGES CONTINUE.
TO PUSH UP OVERALL CLAIM COSTS.
BARGAINING INSURE THE INDUS A
RISK IS PRESSURING REPORT OF
DOUBLE DIGIT RATINGS. BOTH BY
RE. IN CALIFORNIA READ
PROPERTIES SURE HAVE BEEN. TO
TRENDS IN RECENT THE- RENDON.
AND RISK. AND COMMERCIAL SHIRT
INTEREST ALSO- SUBSTANTIAL
PRESSURE ARE RESPONDING.
WILDFIRE RISK AND PRESENT
UNIQUE CHALLENGES IN CERTAIN
COMMERCIAL INDUSTRIES SUCH AS
AGRICULTURE WOULD CALIFORNIA'S
WELL KNOWN FOR. COMMERCIAL
POLICIES ENSURE NOT ONLY THE
PHYSICAL STRUCTURES BUT ALSO
THE INTERRUPTION OF THE
BUSINESS OPERATIONS DURING A
COVERED LOSS SUCH AS THE
INABILITY TO PLANT OR HARVEST
OR RETENTION LOS TOWARDS
REVENUE FROM WINE TASTING ROOMS
AS WELL POTENTIAL DAMAGE TO
CROPS. WHAT THE STRUCTURE IS
INSURED ON PROPERTY MADE
PHYSICALLY SURVIVED THE FIRE
DAMAGE FROM WILDFIRES SPOKE
ALONG CAN. POTENTIALLY
DEVASTATE AN ENTIRE CROP. TO
THE RECORD NUMBER BREAKING A
RECORD BREAKING NUMBER OF ACRES
BURNED WILDFIRES IN TWENTY
TWENTY BUSES DUE TO SMOKE
DAMAGE EVACUATIONS ACCOUNTED%
420% OF LOSSES IN CALIFORNIA
COLORADO. AND 35% LOSSES IN
OREGON WASHINGTON AT SUCH
PROPERTY COUNTERMEASURES MAYBE
REASSESSING THEIR RISK EXPOSURE
AL CAPONE POLICIES HI RESEARCH
SIDE FROM AGRICULTURAL FARM AND
RANCH POLICIES UTILITY.
COMMUNICATION COMPANIES HAVE
BEEN HEAVILY IMPACTED BY
WILDFIRES AS OUR DISTRIBUTION
SYSTEMS ARE OFTEN VULNERABLE TO
WILDFIRES. BUT IN THE RIGHT
WAYS OR EASEMENTS THEY HAVE FOR
THIS EQUIPMENT ARE SUBJECT TO
AN ACCUMULATION OF BUSH AND
BREED THAT CAN FUEL WILDFIRES
AND THERE MAY BE AN ENHANCED
LIABILITY RISK IF THEY DID NOT
CLEAR THE DEBRIS AND BRUSH.
SUBCONTRACTORS. TO THIS TYPE OF
WORK FOR UTILITIES. ANOTHER FOR
MANAGEMENT ACT ALSO FACE AND ON
HIS IN THE CASE OF EACH BECAUSE-
THE- OFTEN GO AFTER THE STOK.
WHO DID THE WORK IN THE AREA.
FORSTER RELATED ISSUES SUCH AS
LONG EMAILS BE. MANY CAN.
WINERIES ARE IN OUR- HARBOR FOR
WHILE. AND TO THE PRODUCTION
BOTH OF QUICK AT THIS. BETTER
RIDERSHIP WITH US AND HAVE IN
TASTING OTHER TOURISTS ADVICE.
COMMERCIAL JERRY SPACES DILEMMA
EXPOSURES. RISK SELECTION IT
KEPT PASSING LIMITATIONS
CHáVEZ SAID EXPOSURES AND
COMMERCIAL CARRIERS ALSO
PROBABLY FOCUS ON MULLIN
EXPOSURE INVESTORS SECTION
ENVIRONMENT AND- TO CHECK OUT
SOME OF THE MEMBERS ARE HAVING
A HARD TIME HEARING YOU SO
THEY'RE ASKING IF YOU CAN. SLOW
DOWN JUST A BIT THANK YOU.
THANK YOU FOR. I APOLOGIZE FOR
THAT- AS MENTIONED ALL LINES OF.
CHIU WITH THE- WORKERS BECAUSE
OUR- BY THE CALIFORNIA
DEPARTMENT OF INSURANCE AND
BOTH RATES AND FORMS MUST BE
APPROVED BY THE DEPARTMENT. FOR
A COMPANY CAN USE THAT. ONE
COMMERCIAL INSURERS OF
TYPICALLY FACE LESS CONSUMER
GROUP INTERVENTION AT A QUICKER
RATE APPROVAL PROCESS THAT
HOMEOWNERS INSURERS. THIS IS
DON'T WANDER TRUE. IN FACT
MARSHALL INSURERS FACED A GREAT
APPROVAL FOR EASE AND POSE BY
THE DEPARTMENT AS A REACTION TO
THE COMPANY NINETEEN PANDEMIC.
CURRENTLY THE DEPARTMENT IS NOT
APPROVING ANY COMMERCIAL RATED
CRIME REQUEST FOR BROAD ARRAY
OF COMMERCIAL PRODUCTS THIS
INCLUDES RATES WHICH WERE
ANALYZED AND READY TO BE
APPROVED WHEN THE PANDEMIC. IT
BACK AND MARCH TWENTY TWENTY. I
TWENTY TWO THE TRADITIONAL
INSURERS RIGHT SPECIFIED LINES
OF INSURANCE TO PROVIDE PREMIUM
RELIEF TO POLICY HOLDERS. AMONG
THE LIVES COVERED BY THE ORDER
ARE COMMERCIAL AUTOMOBILE
INSURANCE. COMMERCIAL MULTI
PERIL INSURANCE COMMERCIAL
LIABILITY INSURANCE AND ANY
OTHER LINE OF THE COVERAGE THE
MEASURE RISK HAVE BECOME
SUBSTANTIALLY OVERSTATED AS A
RESULT OF THE FACT THAT. A. B.
C. I. A. MEMBERS MET WITH THE
DEPARTMENT SOON AFTER THE ORDER
WAS ANNOUNCED. STRESSED THAT
MANY BUSINESSES WORKING TO
CENTRAL AND RATHER THAN SEE A
DECREASE OF REST. THE LINES
WERE ACTUALLY SILVA INCREASE
AND REST. A MEMBERS ALSO POINT
OUT MANY COMMERCIAL POLICIES
TRUE PROVISION. SETS MANY
COMMERCIAL POLICIES ARE BASED
ON THE SIZE PAYROLL OR REVENUE
THE BUSINESS THE BUSINESS
PROVIDES AN ESTIMATE OF THE
OPERATION DURING THE UPCOMING
POLICY YEAR AT THE END OF THE
POLICY- AN AUDIT IS CONDUCTED.
IF THE BUSINESS GREW MORE THAN
EXPECTED BUSINESS LISTING MARC
RICH. IF THE BUSINESS GREW MORE
SLOWLY OR SHUT DOWN DUE TO CO
THAT THE BUSINESS WILL. RECEIVE
A RESPONSE. I HAVE SPOKEN TO
SEE STAFF OF THE- AND POINTED
OUT THE ISSUES THE PIZZA
MEMBERS RAISED IN OCTOBER
TWENTY APRIL TWENTY TWENTY.
DEPARTMENT STAFF ASKED FOR
EXAMPLE WINDS RICHARDS. IS
UNLIKELY THERE WAS ANY COMMON
REGULATED REDUCTION. I PROVIDED%
EXAMPLES BACK IN JANUARY. SINCE
JANUARY I'VE BEEN CALLING EVERY
OTHER WEEKEND AND TOLD THE
DEPARTMENT MEETING ON THE
ISSUE. AND WILL HAVE AN ANSWER
SOON BUT TODAY IS NOT THAT DAY.
I TOO AM START HERE FROM.
SOURCE FROM TO FIND. IN THE
MIDDLE. BECAUSE INSURERS ARE
NOT WRITING THESE POLICIES TO
INADEQUATE RATES. IN ONE
EXAMPLE IN HONOR OF A LARGE
APARTMENT COMPLEX COULD NOT GET
COVERAGE FROM HIS INSURER.
INSURER COULD NOT CONTINUE TO
WRITE BUSINESS WITHOUT A RATE
INCREASE WHICH IS APPARENTLY
FROZEN AT THE DEPARTMENT OF
INSURANCE. DEPARTMENT OWNER HAD
TO FIND COVERAGE IN SECONDARY
MARKET THE PREMIUMS 3100% MORE.
THAN WHAT HE WAS PAYING
PREVIOUSLY. THE NATIONAL CALL
OF THE NC CAN BE PASSED ON TO
TENANTS WHO MAY NOT BE PAYING
RENT. WITH MANY OF THE TENANTS
WORK AT HOME THIS IS A PERFECT
EXAMPLE OF A POLICY. FOR THE
RIVER IT'S ACTUALLY INCREASED
COVER NOT DECREASED. MISTER
SECOND CAN YOU PLEASE- PROP UP
YOUR COMMENTS YOU WANT TO GIVE
THAT MEMBERS AN OPPORTUNITY TO
ASK QUESTIONS THINK. OF IT AS
WELL BUT I JUST WANT A COUPLE
COMMENTS OF PRESCRIBED BURNS.
OF WHICH ARE BEFORE RISK. FORM
FOR REFORM FOR SPANISH EVENT
BRACKETS FOR MANY YEARS. I
FIRST DISCOVERED THIS WHEN WE
DID A TOUR OF THE SAGE CAN
EXPERIMENT FOREST NORTH OF
TRUCKEE. WHICH IS BEING RUN BY
THE UNIVERSITY OF CALIFORNIA.
PART OF THEIR STRATEGY IS TO
FILL THEFORCED TO BURN THE
PILES OF DEBRIS. THE FORCE TOLD
SHORTAGE ON THOSE OF MANY OF
THE CHALLENGES INCLUDING.
LIMITATIONS ON SMOKE AND WHEN
YOU CAN BURKE TYPICALLY THEY
BURN IN THE WINTER WHEN THE
SURROUNDING FOREST. IS NOT AS
BRIGHT AS IT IS IN STOCK THE
SHELVES FOR THE SPREAD OF FIRE.
BUT WINTER CONDITIONS ALSO KEEP
THE SMOKE CLOSER TO THE GROUND.
AS MICHAEL MENTIONED AIR
POLLUTION IS A HUGE ISSUE AT
TWENTY SEVENTEEN. RESOURCES FOR
THE STUDY OF THE NORTH BAY
FIRESTORM. AND FOUND THAT THREE
DAYS OF THAT FIRE PRODUCES MUCH
AIR POLLUTION AS THE ANNUAL
OUTPUT OF ALL CARS AND TRUCKS.
IN CALIFORNIA. AND AB LAST
SUMMER ONE WHO IN SAN. NEED THE
RIGHT OF HOW MUCH SMOKE PART
PERMITS. COULD WE NEED TO SEE
ABOUT BETWEEN BETWEEN. MORE
PRESCRIBED BURNS FOR OR LESS
THE SPARE WHILE AND COMPANIES.
BECAUSE OF THE NASA TALK ABOUT
THE CHALLENGE OF COVERING
PRESCRIBER FROM INSURANCE
PERSPECTIVE. WE TALKED WE WERE
ABLE TO FIND A MEMBER WHO
WRITES THIS COVERAGE AVAILABLE
TO TALK TO THEIR CHIEF
UNDERWRITER ONE OF THE THINGS
THAT SHE NOTED IS THAT SURE
DOES CHOOSE TO UNDER. INSURE
THAT DOES CHOOSE ON RIGHT
THAT'S STRESSED WHAT DO SO
CAREFULLY OFF EXTENSIVELY
INQUIRE NUMBER LOCATION PLAN
TYPE OF ADJACENT LAND OWNERS
THE FEDERAL STATE OR PRIVATE
RESOURCES EQUIPMENT INVOLVED.
AND OTHER CONDITIONS OR
RESTRICTIONS AND BE HERE TOO.
FOR EXAMPLE THE STATE OF
WASHINGTON THE LIMIT ON OUT OF
SMOKE THAT MAY PROVE TO OVER
HIGHWAY. FIVE SEARCH INSIDE AS
THESE GREAT OF OUR LIFE CAN.
WHICH IN. MAKE IT STOP. TO
WHETHER THEY WERE THIS TIME OF
COVERAGE OR HOW MUCH THEY WERE.
STRIVE FIRES BY SURVIVE. IN THE
RIGHT. WITH THE- PRECAUTIONS
ARE- SAY. JUST IN THE NECK
STATE FOR THE FOR EVENTS HELP
BUT THE NEEDS TO BE DAHLE
AGAINST THE RIGHTS OF.
HOMEOWNERS INSURANCE TO COVER
LOSSES FROM FIRE THAT ESCAPES
THE DESIGNATED BURNER. DEFENSE
LITIGATION GENERALLY MAKES UP A
LARGER PORTION OF COVERAGE
SHOPPERS IMPROPER
INDEMNIFICATION ESCORTED
EDUCATION SOME CALIFORNIA.
PRESENT CITY OF AND COST
CONCERNS A DENTAL LIKE THE
DEFENSE LITIGATION. IS MICHAEL
NOTED MANY INSURERS ARE NOT
RIGHT IN LIABILITY POLICIES
OVER ONE MILLION DOLLARS. IN
POLICIES ARE OFTEN REGION.
COULD DEFENSE COSTS WITHIN THE
POLICY. SOMEONE OPERATORS ARE
HAVING TO ON LAW SUM INSURED.
INSURANCE REQUIREMENTS OPPOSED
BY THEIR CUSTOM. IN ADDITION TO
REINSURERS DO NOT HAVE ANY UP
BECAUSE CURRENTLY FORGET FIRE
DEFINITELY. WHAT IS YOUR SECOND
I'M SO SORRY DECAL MORE TIME
BUT- WE HAVE LIMON TIME IN THE
IN THE FOR CAN WRAP UP THE CALL
FOR THE SHOP OKAY QUESTIONS.
THEY YOU SO VERY MUCH- MEMBERS
ANY. FOR PLEASE DO AT THIS TIME
I WILL. WITH OUR- MISTER A
SENATOR WESSEL. THANK YOU VERY
MUCH- AND CHAIR AND I'D LIKE TO
BEGIN BY JUST DIRECTION BUT
SOME QUESTIONS TO MIKE MARTINEZ
OF HIS. HE STILL OF THEIR
PRESENT AND- IT'S- SPONSORED
TO- SOME OF THE ACTIONS THE
LEGISLATURE IS TAKEN IN RECENT
YEARS TO RESPOND TO THE
WILDFIRES INCLUDING- QUITE A
NUMBER OF BILLS THAT ADDRESS-
FUEL- HANDLING OF FUEL OUT
THERE IN THE SITE AND- HELPING
TO. BOB PREVENT FIRES STILL
HOLDING OUR UTILITIES
ACCOUNTABLE AND I REMEMBER
GOING THROUGH THAT PROCESS
PROCESS THERE WAS CONSIDERABLE.
CONSTERNATION FROM THE
INSURANCE COMPANY AND THERE WAS
AN ADMONISHMENT THAT WAS ISSUED
TO THE LEGISLATURE REGARDING
REVERSE CONDEMNATION AND SHOULD
WE GO DOWN THAT PATH AND- THEN
TRY TO. PREVENT THE PRACTICE OF
INVERSE KIND OF IN A NATION AND
AS FAR AS AS FAR AS THE PROCESS
BY WHICH- NORMALLY- H. R. OUR
WILDFIRE RELATED LOSSES ARE
SETTLED- THEY BASICALLY WARNED
THAT THAT IF THAT HAPPENED IF
THE LEGISLATURE CHOSE TO UNDO
THE INVERSE CONDEMNATION
STRUCTURE OF THE WAY OUR OUR-
OUR- LOSSES ARE ARE KIND OF
FOREIGNER STATE. THAT INSURANCE
RATES WOULD RISE- ENORMOUSLY
AND THAT WOULD SEE LOSS OF
COVERAGE OF COURSE WE DIDN'T GO
THAT ROUTE. WE CHOSE TO GO A
DIFFERENT DIRECTION. AND
NONETHELESS WE HAVE SEEN
INTEREST RATES RISE AND- LOTS
OF CONSTITUENTS IN MY DISTRICT
AND WE'RE HEARING OF OTHERS
THAT ARE ARE CONCERNED ABOUT
INVESTING IN CALIFORNIA'S.
HOUSING INFRASTRUCTURE BECAUSE
THEY CAN'T BE SURE PROPERTY.
AND SO WHAT WE'RE DEALING WITH
A SITUATION WHERE WE HAVE DONE
THE RIGHT THING IN TERMS OF THE
LEGISLATURE WE HAVE TRY TRY TO
FIND THAT BALANCE. WE HAVE
TRIED TO. ALLOCATE RESOURCES TO.
COMBAT FIRES TO PREVENT FUTURE
FIRES HOLDEN ARE YOU TO
CONTINUE TO HOLD. OUR UTILITIES
ACCOUNTABLE CREATING A FUND
THAT WOULD HELP- OF OFFSET
LOSSES. AND SO THE INSURANCE
COMPANIES LARGELY HAVEN'T BEEN
TOUCHED BUT THE RATES CONTINUE
TO RISE IN SOME AREAS TRIPLE IN
OTHER AREAS THEY DECIDED NOT TO
COVER IT ALL AND THAT JUST GOES
AGAINST- WHAT WHAT WHAT WHAT
SEEMS REASONABLE IN THIS
PROCESS SO- YOU KNOW MY
QUESTION TO YOU AS THE
CALIFORNIA FAIR PLAN HAS BEEN-
REALLY COMPROMISED WE NEED TO
DO SOME CHANGES AS A
LEGISLATURE WORKING WITH YOUR
OFFICE THERE. TO ADDRESS THE
FAIR PLAN WE NEED TO MAKE
INSURANCE ACCESSIBLE TO PEOPLE
THAT WANT TO BUILD OUR STATE
BECAUSE WE'RE FACING A FIRE
CRISIS WE'RE FACING. A PANDEMIC
WE'RE FACING A CALIFORNIA
HOUSING SHORTAGE. AND AS PEOPLE
ONE INVESTING CALIFORNIANS SAY
WE DON'T WE CAN'T BILL HOUSING
BECAUSE IT'S TOO EXPENSIVE.
IT'S STARTING TO RING TRUE WHEN
YOU THAT THEY- NOT ONLY. OF
HAVE TO TAKE A RISK IN BUILDING
THE HOUSING BUT ALSO RISK NOT
BEING ABLE TO GET MULTI FAMILY
INSURED AND IT JUST DOESN'T
MAKE SENSE FOR YOU TO DEVELOP
THE HIGHER DENSE PROP. UP
PROJECTS- WHERE YOU HAVE MULTI
FAMILY THAT THEY SHOULD COST
MORE THAN A SINGLE FAMILY
RESIDENCE SO MY QUESTION TO YOU
GENERALLY AND IT'S AN
INVITATION AND ALSO A QUESTION.
I THINK THIS LEGISLATURE HAS TO
ADDRESS THIS ISSUE WHY ARE
THERE ANY AREAS THAT- THAT
THROUGH TO THE COMMISSION THAT
YOU ARE WORKING ON ON THESE
AREAS AND MAYBE EVEN
POTENTIALLY- WORKING ON
INTRODUCING LEGISLATION THAT'LL
HELP- GUIDE OUR STATE THROUGH
THIS VERY DIFFICULT PROCESS.
FOR THESE THROUGH THE DIFFICULT
TIMES THAT WE'RE IN. AND I JUST
WANT TO REMIND THE PANELISTS
THAT WE HAVE LIMITED TIME IF WE
CAN KEEP OUR ANSWERS CONCISE
THANK YOU. YES THANK YOU CENTER
HUESO A MICHAEL MARTINEZ HERE
AND THANK YOU FOR YOUR QUESTION
AND I. ABSOLUTELY WANT TO
ACKNOWLEDGE. ALL OF THE-
SUCCESSFUL CHAPTER LEGISLATION
THAT THE STATE LEGISLATURE HAS
MOVED FORWARD THESE LAST
HANDFUL OF YEARS THE-
COMMITTEES BACKGROUND PAPER
PROVIDES JUST A- SMATTERING OF
A LIST OF. RECENT LEGISLATION
TO TACKLE. ACCESS ATTICUS- AND-
AND AVAILABILITY AND
RELIABILITY OF INSURANCE. I
WOULD SAY THAT. ABSOLUTELY WE
BEFORE TO WE AT THE DEPARTMENT
INSURANCE AND SHORT I'M SORRY
AND CERTAINLY INSURANCE
COMMISSIONER LADA WOULD VERY
MUCH WANT TO CONTINUE THE
DIALOGUE THAT- THAT YOU BOTH
HAVE HAD AN AND WE CONTINUE TO
HAVE TO TACKLE ON THE SPACES
YOU HAVE SEEN THE COMMISSIONER
HAS BEEN ANNOUNCING A SERIES OF
ADMINISTRATIVE. SOLUTIONS TO
TACKLE WILDFIRE AVAILABILITY
AND RELIABILITY AND THAT WOULD
HAVE AN IMPACT FOR THE
HOMEOWNERS AS WELL AS
COMMERCIAL SPACE AND I AM HAPPY
TO FOLLOW UP WITH YOUR OFFICE
TO PROVIDE A LISTING OF ALL OF
THOSE ADMINISTRATOR PROPOSED
SOLUTIONS CURRENTLY UNDERWAY
AGAIN UNDER HIS. EXISTING BROAD
AUTHORITY UNDER PROPOSITION ONE
OF THREE AT BECAUSE AT THE END
OF THE DAY. AND HIM OF-
PROVIDING- THESE OF THESE
ADMINISTRATIVE SOLUTIONS AND
THEN IN PARTNERING WITH THE
GOVERNOR'S ADMINISTRATION AND
THE LEGISLATURE WE WANT TO BE
ABLE TO INCREASE INSURANCE
AVAILABILITY AND RELIABILITY
FOR CONSUMERS AND BUSINESSES
ACROSS THE STATE AND THAT TOO
WE'RE ALSO HERE TO PROTECT
THEM. AS WELL SO WE WILL
ABSOLUTELY I CAN FOLLOW UP WITH
YOUR OFFICE TO AND WOULD BE
HAPPY TO ACTUALLY HAVE A- A LOT
OF A DEPARTMENT AND
COMMISSIONER CONVERSATION WITH
YOU JUST OUTLINED- ALL OF THESE
PROPOSED SOLUTIONS. THANK
GOODNESS MY NEXT WILL GO TO DI.
THEY SHARE. FOR QUESTION IS
FOR- ME MOORE TO. JUST QUICKLY-
YEAH THE FAIR PLAN OBVIOUSLY IS
A BIG BOON TO A LOT OF
HOMEOWNERS BUT ALSO TO
COMMERCIAL AND AGRICULTURAL
PROPERTY OWNERS AND IT'S REALLY
IMPORTANT THAT WE KEEP THEM
ACTIVE IN THIS MARKET PLACE-
FAIR PLAY HAS COME OUT WITH A-
A STATEMENT TO- THEIR BROKERS-
THE INSURANCE COMPANIES THAT-
THAT ARE. SOLICITING BIDS FOR
THE FAIR PLAY AFTER THEY SAID
THEY DO NOT WANT TO THERE THE
INSURANCE COMPANY OF LAST
RESORT WHICH MEANS IF YOU CAN'T
GET INSURANCE THEN YOU CAN GO
TO THE FAIR PLAN. WELL I'M
GETTING JUST A CASE IN POINT
HERE JUST EXAMPLE WE'VE GOT A
BIT IT ON A- SMALL WINERY FOR
EXAMPLE IN NAPA TWO HUNDRED
THOUSAND DOLLARS A YEAR IS NOW
THE PREMIUM. THE FAIR PLAN
PREMIUM IS TEN THOUSAND DOLLARS
NOW GRANTED THE COVERAGES ARE
THE SAME AS IN THE BENEFITS ARE
BIT. LOOKING AT THE END OF THE
DAY THE TWO HUNDRED THOUSAND
DOLLAR PREMIUM IS A NON. THEY
DON'T HAVE INSURANCE BECAUSE
PEOPLE ARE NOT THIS BAD TWO
HUNDRED THOUSAND DOLLARS ON
INSURANCE SO I ASK YOU SIR- AT.
DOES THE INSURANCE COMMISSIONER
HAVE AUTHORITY OVER THE FAIR
PLAN. IS THERE A WAY THAT WE
CAN TALK- HE- TO- AND JUST KIND
OF A- BILL TO MAKE SURE THAT-
THE FOR THE FAIR PLAN
ADMINISTRATORS UNDERSTAND THE
REALITIES OF THE MARKETPLACE.
YES SENATOR DODD THANK YOU VERY
MUCH JIM MICHAEL MARTINEZ HERE.
ABSOLUTELY WE DO SERVICE THE
REGULATORY NOT. JUST INSURANCE
INDUSTRY AB BUT ALSO THE
CALIFORNIA FAIR PLAN. AND JUST
TO PROVIDE EVEN A BIT MORE I
WOULD ACTUALLY ASK. MY
COLLEAGUE BRIAN HENLEY WHO HAS
SO TWENTY YEARS EXPERIENCE OF
THE DEPARTMENT INSURANCE
PROVIDED THAT MORE ON. THE
DEPARTMENT'S REGULATION OF THE
FAIR PLAN. THANK YOU MISTER
MARTINEZ- AND SENATOR DODD
THANK YOU FOR THE QUESTION A
BRIGHT IN THE SPECIAL COUNSEL
TO INSURANCE COMMISSIONER
RICARDO LARA. AND TO GET
STRAIGHT TO YOUR YOUR YOUR
COMMENTS AND CONCERNS THE
CALIFORNIA PLAYER FAIR PLAN IS
JUST AS YOU SAID THE INSURER OF
LAST RESORT- ISSUE ALSO NOTED.
THE FAIR PLANS COVERAGES MISTER
MARTINEZ ALSO SHARED IN HIS
OPENING REMARKS IS LIMITED SO
THE PRICE OF THE PREMIUM THAT
YOU HAVE OUTLINED FOR
COMMERCIAL POLICIES. IS LIKELY
IN PART DUE TO THE LIMITS IN
COVERAGE UP TO THREE MILLION
DOLLARS TOTAL COVERAGE AT THAT
POINT FIVE MILLION UNITS ALL
COVERAGES BIND SO. WORD FOR THE
LARGE MAJORITY OF COMMERCIAL
BUSINESSES BE FAIR PLANS
COVERAG IS LIKELY NOT TYPE OF
COVERAGE THAT THAT BUSINESS OR
THOSE BUSINESSES WILL MEET- SO
THERE ARE LIMITS WITHIN WHICH
THE FAIR PLAN OPERATES THE
STATUTORY SYSTEM THAT.
AUTHORIZES THE FAIR PLAN AND
AUTHORIZES THE INSURANCE
COMMISSIONER TO WORK WITH THE
FAIR PLAN TO DEVELOP ITS PLAN
OF OPERATIONS DOES CREATE
LIMITATIONS AROUND THE TYPES OF
PRODUCTS THAT CAN BE INSURED AS
WE KNOW. FARM RISKS ARE
CURRENTLY LISTED AS A AS A
RESPECT CANNOT BE IN SHORT AS
IT IS AUTOMOBILE INSURANCE SO
THOSE ARE TWO EXAMPLES OF RISKS
THAT BY STATUTE. EASTER PLAN
CANNOT CANNOT COVER- AND OF
COURSE WE ARE HAPPY TO WORK
WITH ANYONE WHO HAS CONCERNS OR
OR ONCE INTERPRETIVE GUIDANCE
ON WHAT IT MEANS FOR A FARM
RISK AND WHAT WHAT OTHER
COVERAGES ARE INCLUDED BUT
GENERALLY. COMMERCIAL
BUSINESSESTHAT WANT TO AVAIL
THEMSELVES OF THE FAIR PLAN CAN
DO SO A MAJOR IS NOT TO SIMPLY
BECAUSE OF THE LIMITS THE THREE
MILLION DOLLAR LIMIT. ON
COVERAGE. AND SO WITH THAT THEY
CAN INTEREST DOES HAVE SOME
AMOUNT OF A STORY TO. WORK WITH
EACH IF PLAN ADOPT A PLAN
OPERATIONS THAT WILL ALLOW FOR
COVERAGE OF CERTAIN COMMERCIAL
INSURANCE PRODUCTS BUT AGAIN.
SOME OF THESE PRODUCTS ARE BY
STATUTE EXCLUDED FROM FROM THE
TYPES OF PRODUCTS THAT CAN BE
COOPER. THANK YOU VERY MUCH
ROGER I'LL BE QUICK ON THE NEXT
ONE IF THAT'S OKAY FOR MR
SECOND AND- YOU KNOW ONE OF THE
THINGS WE KNOW IS THAT- THE
LACK OF LIABILITY INSURANCE IF
NOT OUTRIGHT- PROHIBITS BUT
DESCRIBED BURNING BY TRAINED.
AND CERTIFIED BURN BOSSES- WE
ALSO KNOW THAT BURNING. AND
PRESCRIBED BURNING REDUCES THE
POTENTIAL FOR EXPLOSIVE
WILDFIRES IN TREATED AREAS. HE
HAD. YOU KNOW WHY- PRESCRIBED
BURNING REDUCES THE RISK OF
MORE INTENSE WILDFIRES WOULD
THAT CONTRIBUTE TO INCREASING
THE AVAILABILITY OF PROPERTY
CASUALLY INSURANCE OR REDUCE
INSURANCE COSTS IN OTHER WORDS.
HERE'S A- IT'S JUST INTO IT WE
KNOW THE PRESCRIBED BURNING
WORKS WE KNOW THAT IT REDUCES
THE REST FOR- HOMEOWNERS AND
EVEN COMMERCIAL IN IN YOUR
CASE. COMMERCIAL BUSINESSES BUT
YET WE HAVE THIS- DICHOTOMY
THAT- INSURANCE COMPANIES
AREN'T WRITING- POLICIES FOR-
BURN BOSSES CAN YOU COMMENT ON
THAT PLEASE. I COMPLIED WITH
WHAT INFORMATION I HAVE YOU ARE
RIGHT THERE ARE VERY FEW
COMPANIES THAT WRITE IN THIS
SPACE I THINK IT'S A VERY
DIFFICULT SPACE TO WRITE IN A
ONE OF THE ISSUES THAT YOU
MENTIONED IS THE LIABILITY THAT
COMES OF THE FIRE. LEAVES A
DESIGNATED AREA DEPENDING ON
WHERE THE FIRES THAT RISK CAN
BE QUITE SUBSTANTIAL AND SOME
OF THE SUPPLEMENTS ON FOR FIRES
THAT FOR SOME OF THE TIMBER
COMPANIES HAVE BEEN IN THE
HUNDREDS OF MILLIONS OF
DOLLARS. BUT IT IS SOMETHING WE
NEED TO ADDRESS WE ALSO NEED TO
BALANCE THE LIABILITY RESTS
AGAINST THE REST OF THE
HOMEOWNERS AND THE INSURERS
WHOSE PROPERTY MAY GET BURNED
ON IT BACK IN A FIRE THAT DOES
I WAS PRESCRIBED AREA. TERMS OF
THE RIGHT TO RECOVERY BUT IT'S
CERTAINLY SOMETHING THAT WE
WANT TO WORK WITH THE
LEGISLATURE AUTUMN BEFORE
BECAUSE WE THINK IT IS A
VALUABLE TOOL FOR FORCE
MANAGEMENT AND REMEMBER THIS.
IN MANY CASES THE SECRET TO
LOWER INSURANCE RATES IS TO
LOWER THE RISK AND THIS COULD.
BE A STEP IN THAT DIRECTION.
THANK YOU. THANK YOU FOR THAT
ANSWER DOT NET LOCAL TO. SAN
JOE. THANK YOU MADAM CHAIR I
HAD A FOLLOW UP QUESTION FOR
SURE MARTINEZ. BOTH MR MARTINEZ
AND MR SEGMENT- MENTIONED IN
THEIR COMMENTS YOU KNOW THE
PROBLEM WITH THAT COMMERCIAL
INSURERS AND- IN THE FROZEN.
APPROVAL RATES FOR FILINGS. AND
AS A BOTH I THINK BOTH
MENTIONED- INSURERS HAVE
STOPPED RENEWING POLICIES IN
WRITING NEW POLICIES IN THOSE.
AREAS IT AND AS MR HUESO
MENTIONED WE'VE GOT. MULTI
FAMILY. YOU KNOW DEVELOPERS
THAT WANT TO GET. PROJECTS
BUILT AN INSURED. MY
UNDERSTANDING IS THAT THE-
DEPARTMENT OF INSURANCE HAS
STOPPED PROCESSING FORM FILINGS
AND SO I WAS JUST WONDERING IF
YOU CAN SPEAK TO WHY DOES HAVE
BEEN STOPPED AND WINDU-
PREDICT. GETTING THOSE PRODUCTS
THAT PROCESS FOR THOSE FORM
FAMILY STARTED AGAIN. THANK YOU
SENATOR JONES- THIS IS BRIAN
HENLEY SPECIAL COUNSEL TO
INSURANCE COMMISSIONER RICARDO
LARA AND I'D LIKE TO ADDRESS
THAT QUESTION AND- AND- AS WELL
AS WE ALL KNOW EACH YEAR- IN
THE LEGISLATURE AND AROUND THE
STATE OF CALIFORNIA AS WELL AS
THE WORLD. TWO THOUSAND AND
TWENTY WAS A VERY UNUSUAL AND
UNEXPECTED HERE. THE PANDEMICS
HAS RESULTED IN. QUITE A BIG
CHANGE IN THE RISK OF LOSS FOR
A NUMBER OF LINES OF INSURANCE
WITHIN THE STATE OF CALIFORNIA
AS WELL AS NATIONALLY. AND WE
HAVE RECOGNIZE THAT AND HAVE
BEEN COMMISSIONER LIVES HAS
DIRECTED. FOR MANY LINES OF
INSURANCE THAT INSURANCE
COMPANIES LOOK TO. AND CONSIDER
THE CHANGE IN LOSS EXPOSURE AND
THAT INCLUDES FOR COMMERCIAL
LINES OF INSURANCE. COMMERCIAL
LINES OF INSURANCE. FOR
COMPANIES TO GO BACK AND
REVISIT AND ANALYZED THE EXTENT
TO WHICH THEIR LOSS HISTORY HAS
CHANGED INDEED JUST TODAY. A
LOT OF ANNOUNCED YET ANOTHER
BULLETIN TO THE INSURANCE
INDUSTRY. FOCUSING ON PRIVATE
PASSENGER AUTOMOBILE DATA WHICH
HAS SHOWN THAT IN SPITE OF THE
PANDEMIC THE AMOUNT OF PREMIUMS
COLLECTED FOR PRIVATE PASSENGER
AUTOMOBILE INSURANCE. AS
LARGELY OUTSTRIPS THE AMOUNT OF
LOSSES IN TWO THOUSAND AND
TWENTY AND IS JUST ONE EXAMPLE
OF HOW THE PANDEMIC HAS REALLY
REDUCE THE RISK OF LOSS FOR
MANY LINES OF INSURANCE.
COMMERCIAL LINES OF INSURANCE
ARE NO EXCEPTION TO THIS
POTENTIAL ISSUE. AND TODAY
INSURANCE COMMISSIONER LOT ALSO
ANNOUNCED A DATA COLLECTION
EFFORT TO REALLY GET AT THE
VERY QUESTION. THAT YOU'RE
ASKING. IT IS. WHAT LAW DID
CARRIERS IN TWO THOUSAND AND
TWENTY OMITS THE PANDEMIC WHERE
BUSINESSES WERE CLOSING-
EXPOSURES IN LIABILITIES WERE
DROPPING FOR MANY TYPES OF
BUSINESSES AND SO THE
COMMISSIONER HAS DIRECTED TODAY
A DATA COLLECTION EFFORT TO
ASCERTAIN EXACTLY WHAT THE LOSS
HISTORY WAS FOR BUSINESSES AND
FOR INSURANCE COMPANIES
COVERING THOSE BUSINESSES TO
ASCERTAIN WHERE THERE ARE LINES
OF INSURANCE OR PRODUCTS IN THE
COMMERCIAL SECTOR WHERE RATES
INDEED DO NEED TO BE RAISED
VERSUS VARIAS WERE RATES
ACTUALLY SHOULD BE BROUGHT BACK
DOWN MISTER LOTTE. IS VERY
ACUTELY AWARE OF THE IMPACT ON
SMALL BUSINESSES ESPECIALLY
THROUGHOUT OUR STATE THAT HAVE
BEEN HIT SO VERY HARD BY THE
PANDEMICS AND THAT IS A PRIMARY
FOCUS OF OUR CONCERN RIGHT NOW
IS TO MAKE SURE THAT YOU FOR
INSURANCE COMPANIES RAISE RATES
FOR COMMERCIAL BUSINESSES WE
FIRST UNDERSTAND HOW THEIR LOSS
HISTORY LOOK IN TWO THOUSAND
AND TWENTY AND SO THAT IS AN
EFFORT WHICH CONTINUES TO WORK
ON IT USED TO COLLECT
INFORMATION TO HAVE A BETTER.
ANSWER FOR AND UNDERSTAND
EXACTLY WHAT THE EXPERIENCE IS
IN CALIFORNIA AND WILL FOLLOW
THROUGH ON THAT TO DETERMINE
WHERE BUSINESSES AND WHERE
INSURANCE LINES OF PRODUCTS DO
INDEED NEED RATES CREASES
INCREASES FIRST WINES AND
PRODUCTS WERE ACTUALLY PREMIUM
SHOULD BE RETURNED TO THOSE.
GUYS GREAT THANK YOU. THANK YOU.
I DON'T SEE OTHER MICRO. OF
FIRST OF ALL ONE OF MAKE SURE
TO THANK THE FROM FOR ALL HIS
TO COME. AND GIVE US A SUCH AN
IMPORTANT INFORMATION I ALSO
WANT TO THINK MISTER SUTTON.
AND WITH THAT WE WILL BE MOVING
ON TO OUR SECOND PANEL. I WILL
REMIND ALL PANELISTS AND
MEMBERS THAT WE HAVE LIMITED
TIME- DUE TO UNFORESEEN
CIRCUMSTANCES WE STARTED A
LITTLE LATE SO LET'S. SEE IF WE
CAN KEEP OUR PRESENTATIONS ARE
UNDER FIVE MINUTES- AND WITH
THAT I WILL FIRST. INTRODUCE
OUR SECOND PANELIST ON A LEASE
TO BOND PRESIDENT OF THE
CALIFORNIA FAIR PLAN. FOLLOWED
BY CLIFTON BROWN OF THE SURPLUS
LINE ASSOCIATION AND JOHN
NORWOOD. REPRESENTING THE
INDEPENDENT AGENTS AND BROKERS
AT LEAST WE WILL BEGIN WITH YOU
ARE YOU MAY BEGIN. GOOD MORNING
MADAM CHAIR AND MEMBERS OF THE
INSURANCE COMMITTEE. ON BEHALF
THE CALIFORNIA FAIR PLAN
ASSOCIATION THANK YOU FOR
INVITING ME TO SPEAK WITH YOU
TODAY AND FOR EVERYTHING THAT
YOU'RE DOING TO ADDRESS THE
CALIFORNIA. WILD TURN INSURANCE
CRISES. THE FAIR PLAN REMAINS
COMMITTED TO PUTTING OUR
EXPERIENCE AND EXPERTISE TO
WORK WITH POLICY MAKERS AND
STAKEHOLDERS TO HELP ADDRESS
THESE CHALLENGES. AS REFLECTED
IN THE COMMITTEERIGHT UP I'D
LIKE TO ECHO THE ROLE OF THE
FAIR PLAN. THE FAIR PLAN IS THE
INSURER OF LAST RESORT FOR
COVERAGE THAT IS NOT AVAILABLE
THROUGH THE PRIVATE INSURANCE
MARKET. AND IT'S NOT INTENDED
TO REPLACE STANDARD PROPERTY
COVERAGE LIKE HOMEOWNER'S
COVERAGE. WHEN THE LEGISLATURE
CREATED THE FAIR PLAN IT
CLEARLY DEFINED THIS NARROW
PURPOSE FOR THE FAIR PLAN. THE
FAIR PLAN PROVIDES BASIC
PROPERTY INSURANCE PRIMARILY
FOR CONSUMERS WHO ARE UNABLE TO
FIND FIRE INSURANCE IN THE
PRIVATE MARKET. IN FACT THE
INSURANCE CODE MAKES IT CLEAR
THAT THE FAIR PLAN IS NOT TO
COMPETE WITH THE PRIVATE
MARKET. COVERAGES OF THE FAIR
PLAN DOES NOT PROVIDE. ON THE
DWELLING ARE READILY AVAILABLE
IN THE PRIVATE MARKET SIMILAR
TO HOW FLOOD AND EARTHQUAKE
INSURANCE ARE ALSO READILY
AVAILABLE ARE ALSO SUPPLEMENTAL
COVERAGES. BUT WE'VE EXAMPLE
THINK OF A HOUSE IN THE MIDDLE
OF A FOREST WITH ONE WAY IN AND
OUT IT HAS NO FIRE STATION
NEARBY. TO HELP IN THE EVENT OF
A FIRE. THAT HOUSE IS UNLIKELY
THE PERSON OWNS AND HOUSES
UNLIKELY TO FIND A FIRE
INSURANCE COVERAGE IN THE
PRIVATE MARKET. WHAT THE FAIR
PLAN IS THERE TO PROVIDE FIRE
INSURANCE FOR THAT RISKS THAT'S
ABSOLUTELY OUR ROLE IN THE
MARKETPLACE. THE PRIVATE
MARKETS READILY AVAILABLE
PROVIDE. OTHER COVERAGES IT'S
JUST A FIRE PERIL THAT'S NOT
AVAILABLE IN SUCH AN INSTANCE.
WE DO GET A LOT OF QUESTIONS ON
MY FAIR PLAN POLICIES CAN BE
EXPENSIVE. SO I'D LIKE TO TAKE
A MINUTE TO JUST ADDRESS THOSE.
THE FAIR PLAN IS A HIGH RISK
POOL THAT PROVIDES COVERAGE TO
THE HIGHEST RISK PROPERTIES. IN
THE STATE REGARDLESS OF WHERE
THE PROPERTY IS LOCATED. SO NOT
ONLY ARE WE WRITING THE HIGHEST
RISK PROPERTIES THE FAIR PLAN
CANNOT CONTROL MORE SHOULD
WEIGH THE CONCENTRATION OF
POLICIES IN ANY PARTICULAR AREA.
IT'S A FAIR PLANS ROLE TO BE
AVAILABLE TO CONSUMERS WHO
CANNOT OBTAIN FIRE INSURANCE
THROUGH THE PRIVATE MARKET. NOW
IN ORDER TO PAY CLAIMS FOR
THESE HIGHEST RESTS THE FAIR
PLAN WAS CHARGED RATE
COMMENSURATE TO ADDRESS.
GENERALLY SPEAKING I'M OVER
SIMPLIFYING HERE BUT GENERALLY
SPEAKING RATES ARE DEVELOPED TO
COLLECT ENOUGH PREMIUM NOW. TO
PAY FOR FUTURE EXPECTED LOSSES
SO FOR EXAMPLE IF THE FAIR PLAN
HAD. FIFTY EIGHT POLICIES IN
THE STATE AND THE INSURED ONE
STRUCTURE IN EACH OF THE
STATE'S FIFTY EIGHT COUNTIES
THE POTENTIAL FOR WILDFIRE
DAMAGING OR DESTROYING MORE
THAN ONE PROPERTY IS HIGHLY
UNLIKELY. RESULTING IN LOWER
PREMIUMS NEEDED TO BE COLLECTED
NOW FOR FUTURE LOSSES. HOWEVER
THE FAIR PLAN RIGHT ALL FIFTY
EIGHT OF THOSE POLICIES IN THE
SAME COMMUNITY THE LIKELIHOOD
OF A WILDFIRE DAMAGING OR
DESTROYING ALL FIFTY EIGHT
POLICIES IN THE SAME COMMUNITY.
THAT PROBABILITY IS
SIGNIFICANTLY HIGHER IN FACT
THAT RESULTS IN THE NEED FOR
HIGHER PREMIUMS TODAY TO BE
ABLE TO PAY THOSE MUCH GREATER
LOSSES ANTICIPATED LOSSES IN
THE FUTURE SO AGAIN THAT'S
OVERSIMPLIFYING RIGHT MAKING
BUT IN ESSENCE WE HAVE TO
COLLECT ENOUGH PREMIUM TO TAKE
TODAY TO PAY FOR EXPECTED
LOSSES AND LOSSES IN MANY
INSTANCES ARE DRIVEN BY THE
CONCENTRATION OF POLICIES IN A
PARTICULAR AREA. SO ESSENTIALLY
AS THE FAIR PLAN POLICY
CONCENTRATION GROWS OUR
PREMIUMS WILL GO UP. WHICH IS
WHY WE SPEND SO MUCH ENERGY
WORKING ON SOLUTIONS TO HELP
THE FAIR PLAN BECOME SMALLER.
REDUCE CONCENTRATIONS AND
REALLY ONLY BE THERE FOR POLICY
HOLDERS WHO TRULY CANNOT SECURE
NEEDED FIRE INSURANCE. AS
STATED EARLIER. WELLINGS
COVERAGES THAT THE FAIR PLAN
DOESN'T WRITE ARE READILY
AVAILABLE IN THE MARKETPLACE
WHICH FOSTERS COMPETITION WHICH
IN TURN IS GOOD FOR YOUR
CONSTITUENTS. WE REMAIN
COMMITTED TO HELPING OUR TO
REINCORPORATE POLICY HOLDERS
FROM THE FAIR PLAN. BACK TO THE
PRIVATE MARKET AND TO
FACILITATE THIS- WE HAVE
SUPPORTED THE FOLLOWING
LEGISLATION ASSEMBLY BILL
EIGHTEEN SIXTY EIGHTEEN SIXTEEN
RATHER- SPONSORED BY CINNAMON
DALY. THIS IS A BILL THAT
INCENTIVIZES INSURERS TO WRITE
IN HIGH RISK AREAS. BY
PROVIDING THEM RIGHT OUT CREDIT
SO IN THE EVENT OF AN
ASSESSMENT THEIR ASSESSMENT
WOULD BE REDUCED IF THEY WRITE.
PREMIUMS AND POLICIES IN THESE
AREAS AND WE ALSO SUPPORTED
ASSEMBLY BILL THIRTY TWELVE
SPONSORED BY SOMEONE WOULD IN
THE SAME ROOM AND DALY JUST
LAST YEAR. THIS BILL AUTHORIZES
US THE FAIR PLAN TO ESTABLISH A
CLEARING HOUSE WHICH PROVIDES A
PATHWAY FOR FAIR PLAN FOR
CHARACTER PLAN POLICY HOLDER TO
TRANSFER TO A PRIVATE CARE OF
COURSE IT WOULD BE AT THE
CUSTOMER'S CHOICE. BUT IT'S AN
OPPORTUNITY FOR US TO DE
POPULATE TO GIVE THE CUSTOMER
THE CONSUMER MORE OPTIONS IN
THE IN THE- MARKETPLACE IN THE
PRIVATE MARKET PLACE. NOW NOT
LOOKING BACKWARDS IN TWENTY
NINETEEN WE EXPERIENCED
SIGNIFICANT GROWTH AT THE FAIR
PLAN ON OUR DWELLING POLICIES.
WE GREW THE TOTAL NUMBER OF
DWELLING POLICIES BY. 20% OF
THE INSURER INITIATED
HOMEOWNER'S POLICY NON RENEWALS.
NOW THE GOOD NEWS IS. 80% OF
THE POLICYHOLDERS WHO WERE NON
RENEWED BY THEIR INSURANCE
COMPANY WERE ABLE TO SECURE
INSURANCE ELSEWHERE THE BAD
NEWS IS THAT 20% COULDN'T AND
THEY CAME TO THE FAIR PLAN. IT
WELL THAT'S ENCOURAGING THAT
80% DID GO TO THE VOLUNTARY
MARKET WE STILL HAVE- A WAYS TO
GO THEM THE MARKET IS STILL
NOT. WRITING AS MUCH AS WE AT
THE FAIR PLAN WOULD LIKE HIM TO
BUT AGAIN WE'RE SUPPORTING
LEGISLATION AND WORKING WITH
THE LEGISLATURE TO TRY TO. COME
UP WITH MORE CREATIVE IDEAS AND
SOLUTIONS TO MAKE THAT HAPPEN.
I JOKINGLY SAY PRETTY REGULARLY
I WORK IN OPPOSITE WORLD- I
PROBABLY RUN THE ONLY COMPANY
THAT REALLY. THE SUCCESS IS
MEASURED BY. A SHRINKING
PORTFOLIO AND A SHRINKING
CUSTOMER BASE- BECAUSE THAT IS
ACTUALLY A SIGN OF A VERY
HEALTHY VOLUNTARY OR- PRIVATE
MARKET. AT THE MOMENT THAT'S
NOT THE CASE AND I KNOW A LOT
OF WORK IS BEING DONE TO MAKE
THAT HAPPEN. AND AS LONG AS THE
NEED IS THERE FOR SHARE PLANS.
THAT'S ABSOLUTELY OUR ROLE IN
THE MARKETPLACE. WE CONTINUE TO
SUPPORT FINDING SOLUTIONS AND
THAT PRIVATE MARKETPLACE SUCH
AS ASSEMBLY WILL EIGHTEEN
SIXTEEN AND ASSEMBLY BILL
THIRTY TWELVE. AND SO RATHER
THAN TRYING TO MAKE THE FAIR
PLAN THE SOLUTION. IN THE FAIR
PLAN WAS NEVER DESIGNED TO BE
THE SOLUTION THE FAIR PLAN IS
IN FACT A SAFETY NET. AND A THE
INSURER OF LAST ENORMOUS RESORT
BUT MOST IMPORTANTLY A SAFETY
NET FOR THE IMAGE FOR THE-
CALIFORNIA PUBLIC. THANK YOU.
THANK YOU NEXT WE WILL HEAR
FROM CLIFTON BROWN ON BEHALF OF
THE CALIFORNIA SURPLUS LINE
ASSOCIATION I THANK YOU FOR
JOINING US ANTI PLEASE PROCEED
WHEN YOU'RE READY. THANK YOU
MADAM CHAIR MY NAME IS CLOSED
BROWN AND I AM THE VICE
PRESIDENT FOR PUBLIC AFFAIRS
WITH THE SURPLUS LINE
ASSOCIATION OF CALIFORNIA. I'D
LIKE TO THANK YOU AND- VICE
CHAIR JONES AND THE MEMBERS OF
THE COMMITTEE FOR THIS
OPPORTUNITY TO BRIEF YOU TODAY.
ON WHAT WE ARE SEEING IN THE
CALIFORNIA SURPLUS LINES MARKET
PLACE. TO START I WOULD LIKE TO
PROVIDE SOME BRIEF BACKGROUND
ON WHO WE ARE AND WHAT WE DO.
THE SURPLUS LINE ASSOCIATION
WAS CREATED IN NINETEEN THIRTY
SEVEN. AND IT WAS APPOINTED IN
NINETEEN NINETY FOUR AS THE
CALIFORNIA DEPARTMENT OF
INSURANCE IS A SURPLUS LINES IN
PRICE REPORTING LOCATION. IN
THIS ROLE WE REVIEW EVERY
SURPLUS LINE POLICY FILED IN
THE STATE OF CALIFORNIA TO
ENSURE THE BROKERS COMPLY WITH
ALL PERTINENT LAWS AND
REGULATIONS. ARE SIX THOUSAND
LICENSED BROKERS. PLACED
APPROXIMATELY EIGHT HUNDRED
THOUSAND POLICIES WITH A TOTAL
PREMIUM OF ELEVEN POINT TWO
BILLION DOLLARS IN TWENTY
TWENTY. IT IS IMPORTANT TO NOTE
UP FRONT. BUT STATE LAW GIVES
THE ADMITTED MARKET THE RIGHT
OF REFUSAL BEFORE PROGRESS CAN
BE PLACED ON THE SURPLUS LINES
MARKET. SURPLUS LINES BROKERS
BY CALIFORNIA LAW CANNOT
COMPETE WITH THE MILITARY OR
FOR BUSINESS AND MUST PERFORM A
DILIGENT SEARCH FOR AN ADMITTED
CARRIER THAT WILL COVER RISK.
BEFORE PLACING THAT POLICY IN
THE SURPLUS LINES MARKET. IN
SOME INSTANCES ADMITTED
INSURANCE WILL MAKE A BUSINESS
DECISION NOT TO COVER A
PARTICULAR RISK. WHAT CLASS OF
RISKS THESE ARE USUALLY IN
CASES OF NEW. COMPLEX
DISTRESSED. OR HIGH CAPACITY
RISKS. IN THE WHOLE MARKET
THURMOND REASONS TO MANY AREA
MAY REDUCE SOCIAL. FOR INSTANCE
IT MAY IT MIGHT FIND THAT IT IS
TOO CONCENTRATED IN A
PARTICULAR AREA OR THE RISK
PROFILE MIGHT HAVE CHANGED DUE
TO FORCES BEYOND ITS CONTROL.
SUCH AS CLIMATE CHANGE OF
GOVERNMENT ACTION. IN THESE
CASES CONSUMERS NEED OPTIONS
WHERE THEY WILL BE LEFT WITHOUT
THE INSURANCE COVERAGE THEY
NEED. RETAIL AGENT WORKING WITH
THE SURPLUS LINES BROKER
CONSUMERS CAN SEE COVERAGE ON
THE SURPLUS LINES MARKET. THEY
FAILED TO OBTAIN COVERAGE WHERE
THEY CAN GO TO THE FAIR PLAN TO
ATTEMPT TO OBTAIN COVERAGE
THERE. THE OVERWHELMING
MAJORITY OF RISKS THAT GO INTO
SURPLUS LINES ARE COMMERCIAL
HOMEOWNERS CAP ONLY A SMALL
FRACTION OF SURPLUS WILL BE
BREAKING UP. IN THE LAST FIVE
YEARS HOMEOWNERS AND HOMEOWNERS
MULTI PERIL INSURANCE IN
PERSONAL LINES ACCOUNT FOR
BETWEEN ONE POINT THREE AND TWO
POINT 2% OF ALL CALIFORNIANS
SURPLUS LINES PREMIUMS. EVEN AS
THE TOTAL AMOUNT OF HOMEOWNERS
PREMIUMS HAS INCREASED THIS IS
HAPPENING JUST A BACKGROUND OF
INCREASED BUSINESS IN THE
OVERALL SURPLUS LINES MARKET.
I'M CONCERNING COMMERCIAL LINES
WHICH MAKE UP THE LION'S SHARE
OF SURPLUS LINES CONVERGING
CALIFORNIA TRENDS OVER THE LAST
FIVE YEARS HAVE SHOWN A STEADY
INCREASE- PART OF THIS IS DUE
TO THE CONTINUED GROWTH OF
TECHNOLOGICAL ADVANCES SUCH AS
THE SHARING ECONOMY AND
ECONOMISTS VEHICLES AND NEW
LINES OF BUSINESS CREATED BY
LEGAL CHANGES SUCH AS THE
LEGALIZATION OF RECREATIONAL
CANNABIS WHICH ARE CREATED MORE
BUSINESS FOR THE SURPLUS LINES
MARKET PLACE. ADDITIONALLY WE
DO SEE A STEADY INCREASE IN
COMMERCIAL PROPERTY AND
LIABILITY AND IT IS OUR
UNDERSTANDING AT THIS POINT%
THAT BETWEEN FIFTEEN AND 18% OF
COMMERCIAL INSURANCE CALIFORNIA
IS WRITTEN IN THE SURPLUS LINES
MARKET. MANY LINES OF COVERAGE
WRITTEN A SURPLUS LINES INCLUDE
BOTH PERSONAL AND COMMERCIAL
INSURANCE BUT AMONG COVERAGE
LINES THAT WE DON'T BELIEVE TO
BE LARGELY COMMERCIAL. TOTAL
PREMIUMS HAVE INCREASED
STEADILY APPROXIMATELY FOUR
BILLION DOLLARS IN TWENTY
SIXTEEN TO ROUGHLY SEVEN POINT
SEVEN BILLION DOLLARS IN TWENTY
TWENTY. OVER THAT TIME THE
NUMBER OF- POLICIES AND
COMMERCIAL LINES HAVE ALSO
STEADILY INCREASED FROM ABOUT
THREE HUNDRED SEVENTY EIGHT
THOUSAND AND TWENTY SIXTEEN. TO
OVER SIX HUNDRED AND TWENTY
THOUSAND AND TWENTY TWENTY.
TRENDING COMMERCIAL COVERAGE
CORRESPONDS ROUGHLY WITH THE
OVERALL INCREASE AND SURPLUS
LINES BUSINESS IN CALIFORNIA
OVERALL DURING THAT TIME. AND
SURPLUS LINES BUSINESS OTHER
STATES THE TRACK THESE TRENDS
HAVE SEEN SIMILAR INCREASES
DURING THIS TIME. AND ALL OF
THESE CASES THE SURPLUS LINES
INDUSTRY IS FILLING A ROLE THAT
IS NOT BEING SERVED BY THE
ADMITTED MARKET WHICH IS
EXACTLY THE ROLE THE STATE OF
CALIFORNIA HAS ENVISIONED FOR
INDUSTRY. OUR PURPOSE IS NOT TO
SUPPLANT THE IMMINENT MARKET.
RATHER WE ARE HERE TO PROVIDE
ADDITIONAL OPTIONS TO CONSUMERS
WHO OTHERWISE MIGHT NOT BE ABLE
TO OBTAIN THE COVERAGE THEY
NEED. A FAIR PLAN OR OTHER
RESIDUAL MARC MARKETS EXIST TO
OFFER UP COVERAGE OPTIONS WE
NEED TO BE ADMITTED MORE
SURPLUS LINES MARKETS COME ON.
UP WHAT ARE MEMBERS ARE SITTING
IN THE MARKET PLACE CURRENTLY.
IS A HARDENING MARKET. HASN'T
MEDICARE'S PULL BACK IN LINE
SUCH AS HOMEOWNERS. MORE OF
THOSE RISKS ARE COMING INTO
SURPLUS LINES AND CREATING MORE
DEMAND RELATIVE TO SUPPLY. A
NUMBER OF OUR MEMBERS WILL BE
ASKED ABOUT ISSUES OR CONCERNS
THAT YOU'RE SEEING IN THE
MARKETPLACE. DID BRING UP
HOMEOWNERS COVERAGE IN THE
DECREASING APPETITE FOR THIS
LEARN INSURANCE. AND TO A
LESSER EXTENT THE SURPLUS LINES
MARKET AS WELL. ADMITTED
INSURERS OFTEN BRING UP THEIR
INABILITY TO CHARGE RATES
APPROPRIATE TO THE GROWING
RISK. FOR THE SURPLUS LINES
MARKET CONCERNS INCLUDE
REGULATORY GUIDANCE ON NON
RENEWALS AND CANCELLATIONS
BEING OPPRESSED YOU BOTH THE
MAN AND NOT A MILITARY. IN THE
INABILITY TO FACT IN MODEL UN
RIEN COSTS ALSO A CONCERN THIS
MEMBERS. THE SURPLUS LINES
MARKET LAW BECAUSE OF THE
GREATER FLEXIBILITY AFFORDED TO
SURPLUS LINES- TO PUT IT
PLAINLY NO COMPANY GOES INTO
BUSINESS TO GO OUT OF BUSINESS
AT THE END OF THE DAY DECISIONS
ABOUT WHETHER OFFER COVERAGE
COME DOWN TO THE ARITHMETIC OF
WHETHER INSURANCE COMPANY
CLAIMS. AND MAKE CONSUMERS HOLE.
IN CLOSING THE SURPLUS LINES
INDUSTRY PLAYS A VITAL ROLE IN
ENSURING THAT CALIFORNIA
CONSUMERS WHO CANNOT OBTAIN
COVERAGE IN THE AMOUNT OF
MARKET. CAP OPTIONS TO ENSURE
THEIR PRIMARY AGAINST ACTUAL
LOSSES. OUR MISSION IS TO
ENSURE IN RESPONSIBLE ONE
SURPLUS ONE INSURANCE MARKETS
THIS. THANK YOU FOR THE
OPPORTUNITY TO SPEAK WITH YOU
HERE TODAY OF OUR INDUSTRY'S
ROLE IN ENSURING A HEALTHY FAIR
AND COMPETITIVE INSURANCE
MARKET FOR CALIFORNIA. THANK
YOU NEXT WE HAVE JOHN NORWOOD
ON BEHALF OF THE INDEPENDENT
AGENTS AND BROKERS OF
CALIFORNIA MR NOT WOULD GET TO
SEEYOU YOU MAY PROCEED WHEN
YOU'RE READY. GOOD MORNING
MADAM CHAIR MEMBERS JOHN
NORWOOD REPRESENTING THE
INDEPENDENT INSURANCE AGENTS
AND BROKERS OF CALIFORNIA-
CREATES OPPORTUNITY TO TESTIFY
THIS MORNING. THE INVENTORS
AGENTS ASSOCIATION CONSISTS OF
THOUSANDS OF LICENSED AGENTS
AND BROKERS BROKERS LOCATED
THROUGHOUT CALIFORNIA AND IN
YOUR DISTRICTS. ARE MEMBERS
PLACES GREAT MAJORITY OF
COMMERCIAL AND WORKERS
COMPENSATION INSURANCE WRITTEN
IN THE STATE I PROBABLY HAVE TO
ABOUT 30% OF THE PERSONAL LINES
INSURANCE. FOR PERSONAL LINES
ARE MEMBERS RIGHT WITH SOME OF
THE LARGEST HOMEOWNERS INSURERS
LIKE LIBERTY MUTUAL SAFECO
NATIONWIDE MERCURY BUT ALSO
PLACE BUSINESS WITH MORE THAN
NINETY OTHER INSURANCE
COMPANIES WRITING HOMEOWNERS IN
THE STATE OR AT LEAST. USED TO
BE RUNNING HOMEOWNERS IN THE
STATE. I DISAPPOINTED IN A TOWN
HALL MEETING THIS WEEK WITH
OVER TWO HUNDRED OF OUR MEMBERS
ABOUT THE AVAILABILITY AND
AFFORDABILITY OF INSURANCE- ON
THE THIRD VARIANCE IN
CURRENTLY. OUR MEMBERS
DESCRIBES THE CURRENT SITUATION.
FACING THEM AND THEIR CUSTOMERS.
AS UNPRECEDENTED AND THAT'S
SIGNIFICANT BECAUSE MANY OF
MEMBERS COMPANIES THAT ARE MORE
GENERATIONAL OR PROFESSIONALS
THAT HAVE BEEN IN THE INSURANCE
BUSINESS ALL THEIR LINES. IN
ADDITION TO CONCERNS ABOUT
KEEPING OUR OWN AGENCIES VIABLE
THE VERY CONCERNED AND WORKING
HARD TO MAKE SURE THEIR CLIENTS
CAN FIND INSURANCE TO PROTECT
THEIR PROPERTY EVEN TO THE
EXTENT THAT THEY HAVE TO GIVE.
GIVE AWAY THE BUSINESS TO A
COMPETING AGENT OR BROKER TO
FIND COVERAGE. REPORTS WE'RE
GETTING FROM OUR MEMBERS
INCLUDE ONLY A COUPLE OF
ADMITTED INSURERS WRITING
PROPERTY INSURANCE IN ALL OF A
TRIAL IN THE NORTHERN AREAS.
THE MARKET IS VERY RESTRICTED
IN NAPA AND SONOMA COUNTIES IN
SAN LUIS OBISPO AND REALLY IN
ANY OF THE WINE PRODUCING AREAS
OF CALIFORNIA. INSURANCE FOR
PROPERTIES AND AREAS OF SANTA
CRUZ MONTEREY AND CARMEL
STREATLEY RESTRICTIVE AZ'S
INSURANCE AND COMMUNITIES NORTH
OF LOS ANGELES IN ANY HOUSING
THAT IS CLOSE TO CANYONS.
THROUGHOUT SOUTHERN CALIFORNIA.
BILL AFFORDABILITY HOME OR
INSURE IS NOW. IN WITHIN A OR
TWO OF DOESN'T NEED A BRUSH
AREAS. IN A LOT OF OUR MEMBERS
ARE CONCERNED THERE ARE
REACHING CAPACITY REPLACING
INSURANCE SOME AMOUNT OF MINUTE
MARKET. WITH REGARD TO
COMMERCIAL INSURANCE OUR
MEMBERS CONFIRMED THAT THERE
AREREAL ISSUES WITH FARM AND
RANCH PROPERTIES WITH WILDFIRE
AND BROUGHT YOUR EXPOSURE.
PARTICULARLY THOSE INCLUDE
VINEYARDS WINERIES SO CALLED
HOBBY FARMS AND PROPERTIES WITH
EXPENSIVE HOMES AND
OUTBUILDINGS. OUR MEMBERS
COMPLAINED THE FAIR PLAN LIMITS
FOR YOUR PLAN LIMITS FOR
COMMERCIAL OPERATIONS ARE TOO
LOW. AND THERE'S NOT A
DIFFERENCE IN CONDITIONS POLICY
REALLY AVAILABLE FOR THESE
COMMERCIAL RENTS. IN ADDITION
THE FAIR PLAN WILL NOW NOT
RIGHT RESS CAN OBTAIN A QUOTE
FROM A NON ADMITTED INSURERS
EVEN THOUGH THE PRICE IS
SUBSTANTIALLY. HIGHER I THINK
MISTER DODD. MADE REFERENCE TO
THAT. AFFORDABILITY IS BECOMING
A HUGE ISSUE WHEN CUSTOMERS ARE
LOOKING AT HOMEOWNER'S POLICY
PREMIUMS ANYWHERE FROM FIVE TO
TWENTY THOUSAND DOLLARS
ANNUALLY. AND HAVE NO OTHER
PLACE TO GO. WE'VE HEARD LEAST
ONE SUCH WHERE ALLEGE FOR
FAMILY. FORCED PLACED INSURANCE
COVERAGE FOR MILLIONS. WHICH
INSURER WITH THE INSURER CANNOT
AFFORD ANOTHER WHEN WE ARE
LOOKING AT FORECLOSURE. ALSO
PROBLEMATIC THIS PROPERTY AND
LIABILITY INSURANCE FOR YOUTH
CAMPS CONFERENCE CENTERS
RETREATS OUTDOOR EXPLORATION
EXPLORATION FACILITIES OWNED BY
NON PROFITS THEY HAVE THEY HAVE
ANY EXPOSURE TO WILDFIRE. OR OR
WITHIN A MILE OF DOESN'T NEED A
BROCHURE IS THERE SOMETHING
LIKE SIX HUNDRED OF THESE
PROPERTIES IN CALIFORNIA AND
THIS ALSO APPLIES TO PRIVATE
SCHOOLS OWNED AND OPERATED BY
NONPROFITS. MANY OF THESE
PROPERTIES HAVE FACILITIES
VALUED IN THE MILLIONS OR EVEN
TENS OF MILLIONS OF DOLLARS
WHICH MEANS FAIR PLAN LIMITS
ARE INADEQUATE. IN ADDITION
IT'S BEEN REPORTED THE PLAN
INSTITUTIONAL TARGETS ON THESE
PROPERTIES SO THE USER INSUREDS
AND USED TO PAY TEN TO TWENTY
CENTS PER HUNDRED IN PROPERTY
VALUE FOR INSURANCE ON OUR
PAYING. FIVE DOLLARS PER.
HUNDRED FOR INSURANCE IF THEY
CAN EVEN FIND. WHAT OF THE
THINGS OUR MEMBERS REPORT IS
ALTHOUGH THE INSURANCE
COMMISSIONERS BAN ON NON
RENEWALS IS PROVIDING SOME
RELIEF IN AREAS OF THE STATE
THAT HAVE EXPERIENCED
WILDFIRES. THIS REPRIEVE IS
ONLY TEMPORARY. THE SIDE EFFECT
IS THAT IS CAUSING INSURERS TO
NON RENEW PROPERTIES IN AREAS
ADJACENT ZIP CODES DOESN'T MEAN
FOR NON RENEWAL TO REDUCE OUR
EXPOSURE IN THESE REGIONS. IT'S
VERY LIKELY THAT THESE INSURERS
REDUCING EXPOSURE DUE TO THE
COST OR INABILITY TO PURCHASE
REINSURANCE. WE'VE BEEN TOLD BY
AT LEAST ONE ENSURE THAT IF
THEY WISH TO MAINTAIN THEIR
CURRENT PROPERTY. INSURANCE
EXPOSURE THE REINSURANCE COSTS
WOULD DOUBLE AND THEY WILL
LIKELY LEAD WILL LOSE SOME OF
THEIR REINSURANCE PARTNERS. AS
IT TURNED OUT THE COMPANY DID
LOSE SOME OF THEIR REINSURANCE
PARTNERS EVEN WITH A REDUCTION.
IN THEIR ENSURE PROPERTIES. WE
REALIZE THERE'S NO MAGIC IS
GOING TO GET US ON THIS CRISIS
THIS IS GOOD FIFTY YEARS IN THE
MAKING. HOWEVER WE WOULD
ENCOURAGE YOU TO MOVE AS
QUICKLY AS POSSIBLE TO EXTEND
COVERAGE TO THE FAIR PLAN FOR
FARM AND RANCH POLICIES. I
WOULD EVEN GO SO FAR AS
SUGGESTING REQUESTED GOVERNOR
HE ISSUE AN EXECUTIVE ORDER
MAKING THIS CHANGE AND ALLOW
THE PLAN TO FILE AND USE RATES.
FIND ACCELERATE THERE WILL. TO
ENTER THE STREET. THE SAME
COULD BE DONE WITH INCREASING
THE COMMERCIAL LIMITS OF THE
FAIR PLAN UP TO TEN MILLION
DOLLARS. BOTH OF THOSE CHANGES
COULD BE FALL WITH IMPLEMENTING
LEGISLATION. WE'RE ALSO
SUGGESTS THE LEGISLATURE
CONSIDER CONSIDER ALLOWING
INSURERS TO OFFER POLICIES WITH
A WILDFIRE DEDUCTIBLE. UNDER
SUCH A POLICY THE HOMEOWNER
WOULD HAVE A REGULAR OR LOWER
DEDUCTIBLE FOR ONE OFF EVENTS
BUT A SUBSTANTIALLY HIGHER
DEDUCTIBLES MAYBE TWENTY FIVE
TO A HUNDRED THOUSAND DOLLARS
FOR WILDFIRES. THIS WOULD BOTH
REDUCE INSURANCE EXPOSURE TO
WILDFIRE LOSSES. WHILE LOWERING
THE COST OF INSURANCE FOR THE
CONSUMER- WE ALSO FEEL THERE IS
A LOT OF PROMISE CONTAINED IN
THE I'M NOT BILL LAST SESSION
AB TWENTY ONE. SIXTY SEVEN
WHICH PASSED COMMITTEE WERE
WERE ENCOURAGED TO THE
DEPARTMENT OF INSURANCE
INSURERS ARE ACTIVELY
DISCUSSING THESE CONCEPTS FROM
A REGULATORY APPROACH YOU KNOW
SOMEONE DEVELOPS. LASTLY WE
WOULD APPLAUD THE SENATE
BLUEPRINT FOR A FIRE SAFE
CALIFORNIA. MANY OF THE SHIRTS
COMPANIES ARE MEMBERS RIGHT
WITH ARE DEPENDENT ON SUPPORT
FROM REINSURERS. ALL
REINSURANCE MARKET IS COULD
SCARED OF THE CALIFORNIA
WILDFIRE RISK AND WHO CAN
BLAME- HOWEVER. THE
AVAILABILITY OF INSURANCE FOR
HOMEOWNERS AND OTHER BUSINESSES
AND BUSINESSES IN CALIFORNIA IS
SIMPLY NOT GOING TO APPROVE. IN
TOTAL WORLD REINSURANCE
COMMUNITY SEES REAL RESULTS IN
SUBSTANTIALLY REDUCING THE RISK
OF CATASTROPHIC WILDFIRES IN
THE STATE. AS SUCH WE WOULD
ENCOURAGE YOU TO SUPPORT THE-
WILDFIRE BUDGET ITEMS IN THE
ELEMENTS OF THE BLUEPRINT FOR
A- SAFE CALIFORNIA. THANK YOU
FOR THE OPPORTUNITY TO COMMENT
TODAY BE HAPPY TO ANSWER ANY
QUESTIONS. THANK YOU MISTER
NARAL- NOW GO OVER TO MEMBERS-
ANY QUESTIONS I SEE MISTER
DODD. SENATOR DODD. YES THE
FIRST THE FIRST QUESTION IS
ADDRESSED TO- TO- MISS JIM ON
THE FROM THE FAIR PLAN AND THEN
I THINK THE OTHER- MISTER NOR
WATER MISTER BROWN COULD ASK
ANSWER THIS QUESTION IN THE
CONTEXT OF THEIR OWN INDUSTRIES.
SO WE KNOW THAT WE'RE WORD IN
THE IN THE LEGISLATURE HAP
PRIORITIES ON FIXING THE
PROBLEM THERE'S LOTS OF BILLS
THAT HAVE COME THROUGH- IN IN
THE PREVIOUS TWO YEARS THEY'LL
BE BILLS ARE COMING THROUGH
THIS YEAR. NONE OF AMMAR THE
SILVER BULLET BUT ALL OF THEM
KIND OF WORK LIKE A PATCHWORK
QUILT OF. YOBE BILLS THAT- WILL
REALLY HOPEFULLY MOVE THE
NEEDLE IN YEARS TO COME SO I
ASKED THIS QUESTION WE KNOW
THAT WE'RE DOING MORE MORE
PRESCRIBED BURNS AND THIS IS
SOMETHING THAT WE'VE GOT TO
ADVANCE EVEN MORE. WE KNOW THAT
HOME HARDING IS REALLY
INCREDIBLY IMPORTANT THE
GOVERNOR'S PUT IN THIS BUDGET
EARLY ACTION MONEY ADD YOUR-
AND MORE EVENTS- DEFENSIBLE
SPACE WE KNOW THAT A HUNDRED
FOOT DEFENSIBLE SPACE. CREATES
AN OPPORTUNITY TO PROTECT HOMES
EIGHT TIMES MORE THAN WITHOUT
THE- DEFENSIBLE SPACE AND WE
ALSO ARE SPENDING LOTS OF MONEY
ON IRE REDUCTION ASSETS PRE
POSITIONING ASSETS IN THE- YOU
KNOW DURING THE FIRE SEASONS.
SO I ASKED FIRST TO- MYSTERY
BONTA. HILL IS THERE A WAY FOR
THE FAIR PLAN TO REALLY THINK
OUTSIDE THE BOX. AND TRY TO
RECREATE YOURSELF RECREATE THE
FAIR PLAY AND DURING THIS TIME
PERIOD. WHERE WE KNOW THAT OUR
COMMERCIAL PARTICULARLY FARMS
AND COMMERCIAL POLICIES. ARE A
REALLY GETTING TO THE POINT
WHERE THEY'RE NOT GOING TO BE
ABLE TO GET- AFFORDABLE
COVERAGE. AND STEP UP AND FIND
A WAY OR TELL US. WHAT WE
SHOULD BE DOING HERE TO GIVE
YOU THE TOOLS TO FIGHT IN THE
WAY OF PROVIDING THAT
PROTECTION FOR THESE ENTITIES.
THAT WE FOUND WHEN WE FIRST
CREATED THE FAIR PLAN FOR
RESIDENTIAL. CUSTOMERS SENATOR
THIS IS ONLY THE JOB THANK YOU
VERY MUCH FOR YOUR QUESTION. TO
ANSWER YOUR QUESTION
SPECIFICALLY- AS HAS BEEN
MENTIONED THE FAIR PLAN IS
ACTUALLY- LIMITED HI. THE
INSURANCE CODE WE CANNOT TODAY
RIGHT FARM RISKS AND QUITE
FRANKLY YOU COULD ARGUE IN THE
ENTIRE LEGISLATURE COULD
CERTAINLY HELP WE'VE GOT SENATE
BILL ELEVEN OUT THERE WHICH-
WOULD PERMIT US TO DO SO TODAY
OUR HANDS ARE TIED IT'S NOT A
MATTER OF THINKING OUTSIDE THE
BOX. WE ARE LITERALLY PREVENTED
FROM DOING SO BY THE CALIFORNIA
INSURANCE CODE I WOULD
ENCOURAGE EVERYBODY TO TAKE THE
STUFF WE'VE BEEN WORKING WITH
THE FARM BUREAU SINCE THIS
ISSUE CAME TO OUR ATTENTION.
AND YOU KNOW WE'RE EAGER TO
PROVIDE A SOLUTION THAT'S
EXACTLY WHAT THE FAIR PLAN IS
IN EXISTENCE FOR. THANK YOU
MISTER PRIME FOLLOW UP
MISSPELLING CHAIR ABSOLUTELY- I
APPRECIATE THAT DIRECT RESPONSE
INDIAN YOU'RE ABSOLUTELY RIGHT
I GUESS- WHAT I WAS REALLY
THINKING OF ITS- IT'S MY
UNDERSTANDING THAT THE WHITE A
WIDER REDEFINITION IS NOT
NECESSARILY. FARM IS THAT YOUR-
INTERPRETATION. WE HAVE- THAT'S
A GREAT QUESTION WE HAVE
ACTUALLY DONE A LOT OF RESEARCH
ON THAT. AND UNFORTUNATELY
LAWYERS- I I'M NOT SURE WHAT
WAS THE U. S. DA. IT WAS A IT
WAS A FEDERAL- DEFINITION THAT
A WINERY IS CONSIDERED A FARM
SO AGAIN THAT FURTHER TIES OUR
HANDS. WHICH IS WHY WE STRONGLY
ENCOURAGE- CHANGING THE LAW SO
THAT WE CAN WRITE FARMS THAT WE
CAN OFFER THAT SOLUTION. AND
YOU'VE DONE MORE- I THINK
PROBABLY THINKING ABOUT THIS
FRANKLY THAT A LOT OF US. YOU
KNOW HERE BECAUSE THIS IS BEEN
SQUARELY PUT ON YOUR LAP- IS
THIS SOMETHING THAT CAN BE ALSO
DONE BY EXECUTIVE ORDER- OF THE
GOVERNOR OF THE STATE OF
CALIFORNIA OR- TO GIVE THE
INSURANCE COMMISSIONER I'M
SORRY TO BE SO YOU'RE IN THIS
AREA JUST NEVER. HAD ANY
EXPERIENCE. HONESTLY I'M NOT
CERTAIN OF THE ANSWER THAT MR
MORE. CERTAINLY BROUGHT THAT UP
BUT I DON'T KNOW WHAT THE WHAT
THE RULES ARE SURROUNDING.
THANK YOU VERY MUCH I
APPRECIATE YOUR TIME. I'D LIKE
TO BELIEVE IT IS POSSIBLE
THOUGH SENATOR JOHN IT'S
SOMETHING I WOULD I UNDERSTAND
THE URGENCY THAT SOMETHING IF
IT WERE POSSIBLE. I WOULD
ABSOLUTELY BE IN FAVOR OF THAT.
BUT ABANDONED. BUT I ALSO
ASSUME IF THE THAT YOU HAVE TO
DO THE BACKGROUND WORK AND
MAYBE YOU'RE DOING IT NOW
BECAUSE- ALL THE SUDDEN YOU
CAN'T JUST WRITE THESE PERILS
WITHOUT THINKING. ABOUT YOU
KNOW HOW MUCH MORE MONEY YOU
HAVE TO HAVE AS A BACKSTOP IN
THE EVENT OF RISK AND- ALL
THOSE THINGS WARD IT GIVE MY
ROD IS ARE PLENTY OF ASSETS.
THERE TO BE ABLE TO- CHARGE THE
APPROPRIATE RATES AND ACCEPT
THE RISK. I'M TODAY SENATOR
DODD NO DON'T HAVE THE ASSETS I
BELIEVE WHAT MISTER NORWOOD WAS
RECOMMENDING WAS AN EXECUTIVE
ORDER THAT ALSO INCLUDED FILING
USE. WHICH COMPLETELY SPEEDS UP
OUR ABILITY TO RESPOND TO THIS.
VERY GOOD. THANK YOU MISTER DOT
THINK ENEMIES AND I HAVE A
QUESTION FRONT AND AT LEAST THE
FAIR PLAN AS WELL AND I WANT TO
ADD MY VOICE TO MISTER DODGES-
STATED IN TERMS OF TRYING TO
REINVENT THE FOR PLAN TO REALLY
COINCIDE WITH US SUCH UP IN
INTEREST YOU TIME AS IT
PERTAINS TO THE OFF HOURS AND
HOW WE'RE SEEN CHANGES ACROSS
THE STATE- I DO HAVE SB ELEVEN
WHICH IS A BILL. THAT- YOU KNOW
WHEN WE INTEND TO ADDRESS SOME
OF. FIRST RANCHERS GRAPE
GROWERS SO I JUST WANT YOUR
THOUGHTS IN TERMS OF WHAT DO
YOU ANTICIPATE. OR HOW IS YOUR
BUSINESS GOING TO CHANGE AS A
RESULT OF THIS. BILL DO YOU
THINK THAT THE- THE COSTS WILL
GROW SIGNIFICANTLY FOR THE
OTHER. FAIR PLAN CUSTOMERS. I'M
THANK YOU VERY MUCH SENATOR
RUBIO OF THE PRICING WOULD NOT
AFFECT FOR EXAMPLE THE
INDIVIDUAL HOMEOWNERS BECAUSE
IT SAYS IT'S A COMMERCIAL LINE
OF BUSINESS SO THE PRICING
WOULD BE WITH AND THE
COMMERCIAL- PRICING. MARKET IF
YOU WILL SO WOULDN'T IMPACT
THE- INDIVIDUAL HOMEOWNER OR
THE DWELLING POLICY PREMIUMS
PER SE NOW- CLEARLY WE NEED TO
DO SOME WORK TO FIGURE OUT WHAT
THE APPROPRIATE RATE IS AND
WHAT THE APPROPRIATE FORMS ARE.
BUT YOU KNOW I'M ACTUALLY OUT
QUITE INTRIGUED BY WHAT SENATOR
DODD AND MR NOR WOULD- BOTH
PASSED- SUGGESTED AND ASKED
ABOUT- THE PROCESS AND I
BELIEVE I HEARD THIS EARLIER
FROM MISTER SECOND THE PROCESS
OF GETTING COMMERCIAL FILINGS
APPROVED. IT IS A IT'S NOT A
SPEEDY PROCESS- I CAN SPEAK FOR
THE FAIR FINALLY HAD A
COMMERCIAL FILING IN PLACE
SINCE JULY OF LAST YEAR-
HOWEVER EACH IF AN EXECUTIVE
ORDER IF THAT AVENUE WERE
POSSIBLE IT'S CERTAINLY
SOMETHING THAT WE WOULD.
IMMEDIATELY GET ON AGAIN I
CAN'T STRESS ENOUGH WE
RECOGNIZE. THE NEED FOR THIS
AND THE URGENCY OF THIS. BUT
AGAIN TO SOME DEGREE OUR HANDS
ARE TIED SO- WE WOULD MAKE IT
WORK AGAIN I CAN'T STRESS
ENOUGH THIS IS OUR ROLE IN THE
MARKET PLACE. WHICH IS WHY WHEN
THIS WAS BROUGHT TO MY
ATTENTION WE WERE ALL OVER IT
SO- I AM I AM RIGHT THERE WITH
YOU WITH SENATOR DODD WITH
EVERYBODY WHO NEEDS A SOLUTION
IS A SOLUTION FAST WE WILL DO
EVERYTHING WE CAN AT THE FAIR
PLAN. THANK YOU ANY OTHER
QUESTIONS. CHEROKEE WE HEAR
FROM- MISTER NORWOOD ON THAT ON
THIS ISSUE SEE IF HE HAS ANY
ANY THING IN ADDITION.
ABSOLUTELY MISTER NORWOOD IS
THERE ANY COMMENTS I. STAVING
ONE OUT TO THIS CONVERSATION.
SURE OF THE GOVERNOR HAS ISSUED
AS YOU ARE WELL AWARE. I THINK
IN EXCESS OF FIFTY EXECUTIVE
ORDERS CHANGING SOMETHING LIKE
FOREIGN FIFTY STATUTES IN
CALIFORNIA- SOME OF THOSE HAVE
BEEN MORE COMPLEX THAN CHANGING
A FEW WORDS TO THE FAIR PLAN
STATURE- YOU KNOW IN. IN LEASE
CORRECTLY IN THE JOB EVEN IF
THEY GOT A FORTY IT WOULD TAKE
A WHILE TO HAVE. FORMS AND
FILINGS BUT THAT'S THE REASON
FOR ALLOWING THEM TO DO A FILE
AND USE FOR TERRY OF TIME MAYBE
SIX MONTHS OR SO BEFORE THEY
HAVE TO GET SOMETHING INTO THE
APARTMENT. THANK YOU REALLY
JUST DO IT COPYCAT FILING WITH
ONE OF THE COMPANIES THAT WRITE
TODAY IN THAT SPACE- AND THEN
GET UP AND RUNNING. SO I THINK
THAT'S- YOU KNOW AS FAR AS I
CAN I CAN SEE I DON'T SEE ANY
REASON NOT TO DO SOMETHING LIKE
THAT OR TO PARTNERS CLAWS ON SB
ELEVEN WHATEVER THE CASE MAY
BE. BUT. I THINK I THINK IT'S A
POSSIBILITY. THANK YOU VERY
MUCH OF THAT THEY MUCH ABOUT
FOR YOUR- SO I WANNA TAKE WOMAN
TO. I'M A LEASE- FIFTEEN BROWN
INTO NORWOOD FOR THIS. EVER AS-
SO I THINK YOU ALL- NOW ARE TO
MOVE ON TO OUR- OUR THIRD
PANEL. AT THIS TIME AND WE'RE
GOING TO START TODAY WITH BY
LAYING OUT QUINN DAVISON FROM
THE UNIVERSITY OF CALIFORNIA
COOPERATIVE EXTENSION. MISTER
ROBERTS SPIEGEL REPRESENTING
THE FARM BUREAU. BEING LAST AND
I THINK BOTH OF YOU FOR YOUR
PATIENCE TODAY I WILL START
WITH THAT MRS QUINN DAVISON-
YOU MAKE IT BEGIN WHEN YOU'RE
READY. OKAY THANK YOU SO MUCH-
GOOD AFTERNOON. THANKS SO MUCH
FOR THE INVITATION TO JOIN US
HEARING I'M REALLY HONORED TO
BE HERE MY NAME IS LAYING IT
COULD BE THE SENATE AND I AM A
FIRED VISOR THE UNIVERSITY OF
CALIFORNIA COOPERATIVE
EXTENSION I'M ALSO THE DIRECTOR
OF THE NORTHERN CALIFORNIA.
FIRES CONSOLE AND I'VE WORKED
ON FIRE RELATED ISSUES FOR THE
LAST. TWELVE OR THIRTEEN YEARS.
SHARE FOR THOSE OF YOU WHO
DON'T KNOW I KNOW WE'VE BEEN.
ABOUT IT QUITE A BIT DURING
THIS. BUT IT'S THE USE OF. AND
RELEASED THIS CONDITIONS
PREDETERMINED CHECKED. AND IT'S
WELL KNOWN TO BE ONE OF THE
MOST COST EFFECTIVE AND
ECOLOGICALLY APPROPRIATE AND IN
A SMALL. WE HAVE HERE IN
CALIFORNIA. THEY CAN BE USED TO
MEET A WIDE VARIETY OF SECTORS.
FOR A WHILE HIGHER RISK
PERSPECTIVE THERE'S A LARGE
BODY OF RESEARCH THAT SHOWS
MOST AFFECTED FUELS REDUCTION
PROJECTS. ARE THOSE THAT
INCLUDES. RESEARCH SHOWS THAT%
FIRE NOT ONLY. THE AND FUTURE
WILDFIRE BUT ALSO TO DROUGHT
INTO. RANCHERS OTHER LAND
PRESCRIBED FIRE IT'S COOL TO
REALLY I MEAN. AND IT'S CLANCY.
NEED AMERICAN BURNING IS IN TO
THE ULTRA. AND THE REASON AND
TRADITIONS ACT WATCH KNOWLEDGE.
TIME WITH THE NEED FOR
PRESCRIBED FIRE REALLY IS
LONGER IN CLASS ARE FEDERAL
STAGE ARE SETTING THIS TARGETS
AND THERE'S NO A BIRD CRAFT
MOVEMENT AROUND THE STRIKE
HELLO. RESTRUCTURING HE OTHER
LET PROGRAMS. AT THE SAME TIME
WE'RE GETTING READY TO WATCH
THAT NEW SPEAKS FOR FROM WHICH
WOULD MEAN BY CALL SIX AND
TWENTY AND HAS JUST BEEN.
ANDREW THIS WE WILL SEE SORT OF
HIGH EXPERIENCED PRACTITIONERS
PLAN AND WE ON STATE
LANDSTRASSE. IN SHORT IS A
REALLY LITTLE CRIME OF FIRED-
THE OPPORTUNITIES RIGHT IN IF
GAIL OF THIS IMPORTANT- BUT
SIRIUS CHIU REMAIN AND THE BIG
CHALLENGE THAT FACE THE FRONT.
YEAH ARE. SOUNDS REASONABLE BUT
IN PRACTICE IT'S A VERY
SUBJECTIVE STANDARDS LEADS TO
SIGNIFICANT UNCERTAINTY AND
DISCOMFORT IN THE WORST CASE
WHICH IS KIND OF THE MOST
COMMON AREA THESE INDIVIDUALS
ORGANIZATIONS DECIDE NOT TO USE
PRESCRIBED FIRE BECAUSE OF
COURSE RESCUES HIGH. THE
LIABILITIES A CERTAIN. CASES
WORKING DECIDE TO THE FOR WITH
FIRE THEY OFTEN WITH OR HOW
INTENSITY THAT INSURANCE AND
WORK AGAIN THIS IS A IS. OF A
LOT LAW AND PERCEIVED THREAT.
INSURANCE CRITICAL OF THIS
PUZZLE AND I THINKRECEIVED
BECAUSE IT'S REALLY A TO NOTE
THAT RECORD OF FIRE I'M A
MEDICINE IT WAS PUBLISHED IN
TWENTY. FOUND IN THIS REYES OF
LESS. ACTUAL UNFORTUNATELY AT
THE SAME TIME ALL THIS MOMENTUM
BUILDING ROCKETS FIRED
CALIFORNIA INSURANCE COMPANIES
HAVE INCREASINGLY DECIDED NOT
TO COVER THESE ACTIVITIES THANK
YOU FOR EARLIER IN THIS HEARING
AS ONE EXAMPLE THE WATERSHED
CENTER AND SHOULD BE COUNTY HAS
BEEN LEADING COOPERATIVE FOR
STRUCTURE FIRE FOR MORE THAN A
DECADE AND THE TREATED MORE
THAN TWO THOUSAND ACRES OF
STRATEGIC PROJECTS IN TWENTY
FOURTEEN NAY FILED A CLAIM FOR
DAMAGES DECEMBER RESOURCES
WITHIN ONE OF THEIR PERMITTED
BURN UNIT AT THE REQUEST OF THE
LAND. AND UPON EVEN AT A FAIRLY
MINIMAL CLAIM THE WATER CENTERS
POLICY WAS CANCELED NOW DESPITE
HAVING QUALIFIED FOR BOSTON
STAFF AND SOME OF THE MOST
ROBUST RISK MANAGEMENT
PROCEDURES IN PLACE THEY WERE
UNABLE TO PURCHASE A NEW POLICY
IS TWENTY EIGHTEEN DURING WHICH
TIME THEY HAVE A CONTRACT WITH
A PRIVATE FIRM EITHER BY THIS
INCREASE COSTS ON OLDER
TRANSLATION THIS VERNE WINDOWS
AND OVERALL JUST INCREASE THE
QUANTITY AND GET THEIR MONEY
MOST RECENTLY THEY WERE
INFORMED THAT THEIR CURRENT
POLICY WILL BE CANCELED ON MAY
FIRST THIS YEAR. AND DESPITE
BEING ONE OF THE MOST QUALIFIED
BRING PROGRAMS WITHIN THE
NONPROFIT CALIFORNIA EVEN
UNABLE TO FIND INSURANCE ON THE
PRIVATE MARKET AND THEIR WORKS
RELIEF INSTALL ANOTHER EXAMPLE
IS IN THAT KIND OF WATER CITY
COUNCIL HUMBLE COUNTY WHICH IS
I USUALLY REPUTABLE AND-
TRUSTED PROGRAM AND THEY LOST
THEIR LAWYERS BROAD FORM
INSURANCE COVERAGE IF
POLITICALLY TWENTY JUST AS THEY
WERE ONBOARDING THEIR NEWLY
HIRED FEDERALLY QUALIFIED. FOR
AS A RESULT IT MARK THEIR
GRANTS TO SERVE A PRIVATE FIRM.
MANY OF WHOM ALSO LOST. JAMES
AND THEN THE CONSERVANCY IS ONE
OF THE FEW. NGOS. BYE BYE
QUALIFIED AND- INSURED BURN
BOSS. BASICALLY HAVE TO HOW
ACROSS THE COUNTRY GET YOUR-
AND- THAT CAUSES TO MISS A LOT
OF POTENTIAL DAYS. AND BRING
BRING BOSTON THE AREA ALSO
TRUST ISSUE FOR THE CAN AND I
REALLY HE'S FAST. I'M SURE ONE
MORE THING IS THE MY PRIDE
CONTRA WHO ALSO. QUALIFIED BOSS
IN HIS CASE HE'S BEEN TOLD HIS
AND AGE IS. ARC BUT HE'S REALLY
BEEN IN TO GET THAT RIGHT. USE
SHOULD HE THAT THEY CANCEL THE
POLICY IF YES ME. THESE ALSO
CERTAINLY YOU HIS POLICY WOULD
CANCELED IF WE EVER HAD FILE A
CLAIM. HE SAYS HE REALIZES THE
A WALK ON ICE BUT A RISK SMALL
AND- THE BELIEVES. FOR HIM
BECAUSE HE'S WORKING SYSTEM AS
A HELLO. CONTRACTOR IS ONE OF
THE FOUR AND PRIVATE PLAN BY
AVAILABLE TO THIS WORKING
CALIFORNIA NOW AND HE'S ABLE TO
MEET THE DEMAND FOR HIS. EXPERT
WE ALL YOUNG ACROSS. EXAMPLE
ILLUSTRATING. THE POSED BY LACK
OF. INSURANCE IN THE SUBJECT BE
LESS CERTAINTY OF THE STATE.
PROVIDING INCENTIVES FOR THE
NEED FOR. AND THIS IS WHY I AM
SUPPORTIVE OF STANDARDIZED
RECENTLY INTRODUCED SENATE BILL
THREE THIRTY TWO REGARDING
LIABILITY FOR CALIFORNIA C.
CERTIFIED BOXES AND ALSO WHILE
I WENT IN FOR A STATE HAVE YOUR
YEAR TO DATE AND SECURE YOU ALL
TALKING ABOUT THIS WEREALLY
NEED LIABILITY AND INSURANCE
SOLUTIONS. FOR I REALLY
APPRECIATE YOUR TIME THANK YOU
SO MUCH THE. THANK YOU VERY
MUCH FOR YOUR TESTIMONY BEFORE
I MOVE FORWARD- SOMEONE WHO'S
ON REMOTE LINE HAS ANOTHER
DEVICE ON WE WOULD KINDLY ASK
THAT YOU TURN IT OFF OR MEET
YOURSELF THANK YOU. NEXT E
WILL MOVE ON TO ROBERT SPEAK ON
BEHALF OF THE CALIFORNIA FARM
BUREAU. A PIECE PROCEED WHEN
YOU'RE READY. THANK YOU GOOD
AFTERNOON MADAM CHAIR AND
MEMBERS. MY NAME IS ROBERT
SPIEGELMAN ADVOCATE WITH THE
CALIFORNIA FARM BUREAU
FEDERATION AND VERY MUCH
APPRECIATE THE OPPORTUNITY TO
BE HERE WITH ALL OF YOU TODAY.
THE CALIFORNIA FARM BUREAU
FEDERATION REPRESENTS
APPROXIMATELY THIRTY FOUR
THOUSAND OF THE STATE'S FAMILY
FARMERS AND RANCHERS AND AS AN
ORGANISATION WE ADVOCATE ON
NUMEROUS ISSUES IMPACTING THE
FAMILY FARM AND RANCH. SO IS
PROVIDED IN THE COMMITTEE
BACKGROUND- CALIFORNIA'S
COMMERCIAL FARMS AND RANCHES
ARE IN THE MIDST OF A TRULY
UNPRECEDENTED- INSURANCE
AVAILABILITY ISSUE.
CALIFORNIA'S COMMERCIAL FARMS
AND RANCHES ARE LOSING
INSURANCE COVERAGE AS A RESULT
OF THE INCREASED WILDFIRE
ACTIVITY OVER THE LAST FIVE
YEARS UNFORTUNATELY THE DATA AS
TO HOW MANY FARMS AND RANCHES
ARE LOSING INSURANCE COVERAGE
IS ONLY ANECDOTAL. SO WE HAVE
NO TRACKING DATA EIGHT
AVAILABLE TO FULLY ASCERTAIN.
THE DEPTH OF THIS PROBLEM
HOWEVER OVER THE PAST SEVERAL
MONTHS THE CALIFORNIA FARM
BUREAU HAS BEEN ABLE TO ACQUIRE
SOME DATA FROM ABROAD
MEMBERSHIP ARE PARTNERS WITH
OUR INSURANCE BROKERS- THAT
ENSURE FARM PROPERTIES. AND TO
pFIVE HUNDRED FARMS AND RANCHES
IN THE NAPA SONOMA COUNTY
REGION AT LOS COVERAGES DOZENS
MORE MONTEREY COUNTY IN THE
CENTRAL COAST. MOVING FURTHER
SOUTH IN CALIFORNIA THE
COUNTIES OF VENTURA SANTA
BARBARA RIVERSIDE ORANGE AND
SAN DIEGO ARE SEEING DOZENS OF
FARMS AND RANCHES LOSE
COVERAGE- LOSE THEIR INSURANCE
COVERAGE IN FACT AS FAR NORTH
AS MODOC COUNTY INTACT.
ACTUALLY I HAVE BEEN RECENTLY
INFORMED THAT WE HAVE RANCHERS
LOSING COVERAGE ALL THE WAY UP
AND ALTARIS. AS WE HAVE SEEN
CALIFORNIA'S WILDFIRES HAVE
ENCROACHED UPON AGRICULTURAL
LAND WITH INCREASING REGULARITY
AND INTENSITY AS AN EXAMPLE THE
TWENTY TWENTY ALLEN YOU CON-
LIGHTNING COMPLEX FIRE IN CLASS
FIRE IN NAPA COUNTY IT'S
BECAUSE MORE THAN A HUNDRED AND
SEVENTY FIVE MILLION IN DIRECT
AGRICULTURAL DAMAGES TO
PROPERTY. AND AGRICULTURAL
INFRASTRUCTURE LOSSES HAVE
EXCEEDED ABOUT THIRTY FIVE
MILLION DOLLARS SO THIS WOULD
INCLUDE THINGS LIKE VINEYARDS
ORCHARDS GRAZING LANDS
AGRICULTURAL INFRASTRUCTURE AND
LIVESTOCK BEING COMPLETELY
KILLED ANDERSON. AND WERE
DESTROYED. SO WELL DIRECT
FINING LOSS TAG. AND FIRST.
SELDOM REACH THE LEVEL FINING
LOSS THAT WE SEE. A IN THE CASE
OF WILDFIRE DAMAGES TO OTHER
RESIDENTIAL PROPERTIES AND
COMMERCIAL PROPERTIES IT
DOESN'T MAKE THE SITUATION ANY
LESS DIRE. IT'S NOT THE
TOTALITY OF FINANCIAL LOSS IT
IS CONCERNING LET'S BE CLEAR IT
IS DEFINITELY TO AN EXTENT
CONCERNING. BUT THE REAL ISSUE
IS THAT COMMERCIAL AGRICULTURE
HAS BEEN CAPTURED IN THE
GREATER INSURANCE AVAILABILITY
ISSUE AND DRAMA THAT'S THE
FOLLOWING MANY RESIDENTIAL AND
OTHER COMMERCIAL PROPERTIES IN
THE STATE. SO WITH WILDFIRE
RISK AND THE DAMAGES TO
PROPERTY HAD CONTINUE TO
INCREASE THE INSURANCE MARKET
HAS RESPONDED ACCORDINGLY TO
THAT RISK HOWEVER. THERE IS A
VERY SIGNIFICANT DIFFERENCE FOR
COMMERCIAL FARM AND RANCH WHEN
THE PRIVATE INSURANCE MARKET
TAKES STEPS TO REDUCE THE RISK
PORTFOLIO. NOW IF YOUR
RESIDENTIAL AND COMMERCIAL
POLICY HOLDER YOU HAVE THE
ABILITY TO SHIFT TO OTHER
CARRIERS OFFERING SIMILAR
COVERAGE OR FIND COVERAGE VIA
CALIFORNIA FAIR PLAN. AND THIS
HEREIN LIES A VERY SPECIFIC
PROBLEM. WHY IF THE FARMER
RANCHER FONG. A SIMILAR
INSURANCE COVERAGE TO REPLACE
THE POLICY THAT WAS NOT RENEWED.
WELL QUITE OBVIOUSLY THE FAIR
PLAN IS THE INSURER OF LAST
RESORT EXCEPT WHEN IT ISN'T AND
WHEN EXISTING CALIFORNIA LAW
FAILS TO EXPLICITLY PROVIDE.
THE ABILITY OR AVAILABILITY FOR
COMMERCIAL FARMS AND RANCHES
AND MEMBERS OF THE COMMITTEE
THIS IS EXACTLY THE PROBLEM
THAT'S THE FOLLOWING MY
INDUSTRY AND MY MEMBERS TODAY.
THE FARM AND RANCH INSURANCE
POLICIES HAVE BEEN AND CONTINUE
TO BE NON RENEWED AND THE
REASON A BACKSTOP FOR THE
COMMERCIAL AGRICULTURAL
COMMUNITY. SO TAKING A STEP
BACK YOU KNOW WHAT WHAT ARE THE
FARM WHAT ARE WHAT IS OUR WHAT
OUR FARM AND RANCH INSURANCE
POLICIES AND WHAT HE'S POLICY
COVERS HOW DO THEY WORK. AND
THIS IS REALLY THE MOST COMMON
QUESTION I'VE HAD TO ANSWER
OVER THE LAST TWELVE TO
FOURTEEN MONTHS. ENTER
PARAPHRASES. IT TO SIMPLIFY IT.
THE FAMILY OPERATED FARM OR
RANCH TYPICALLY HAS. A VARIETY
OF REAL AND PERSONAL PROPERTY.
THIS CAN BE FOR A QUICK NAP BY
SAKE BUILDINGS- THE LOSSES
HOWEVER CAN COME FROM THE
PERILS THAT AFFECT ANY OTHER
KIND OF BUSINESS OR PROPERTY
AND THESE CAN BE FIRE SLIGHT
STATURE. WHICH REALLY IN MOST
SIMPLY A FARM INSURANCE
POLICIES ARE R. RANCHO POLICIES
ARE KIND OF LIKE A HYBRID. THEY
CAN COMBINE STANDARD COVERAGES
OFFERED BY A PERSONAL
HOMEOWNERS POLICY WITH
COMMERCIAL PROPERTY AND
LIABILITY COVERAGE. AND THE
BENEFIT OF THE FARM POLICY IS
THAT CAN BE CUSTOMIZED TO THE
NEEDS OF FARMERS. FOR EXAMPLE.
IN TERMS OF FARM LIABILITY
VERSUS COMMERCIAL LIABILITY.
INSURANCE INDUSTRY TREATS THIS
IN A MANNER WHERE THE INSURED
IS GROWING FRUIT OR RAISING
CATTLE. AND THEY'RE SELLING THE
ROCK COMMODITY IN UNADULTERATED
FORM. THIS WOULD BE COVERED
UNDER WHAT IS CALLED THE
FORMALIZED ALREADY COVERAGE
FOR. HOWEVER ONCE THE INSURED.
ALTERS THE FORM OF A COMMODITY.
LIKE CATTLE BEING SOLD
PREPACKAGED BEEF. THIS IS
CONSIDERED A COMMERCIAL
EXPOSURE SO THEREFORE THE FARM
WOULD NEED A COMMERCIAL
LIABILITY POLICY. IN PLACE TO
PROPERLY COVERED SELL THE
PACKAGE BEEF. SENT OUT FOR FARM
PROPERTY IT'S A LITTLE SIMPLER.
ANY FARM BUILDING THAT IS USED
FOR BUSINESS ACTIVITY OTHER
THAN FARMING. IS NOT COVERED
UNDER THE FARM PROPERTY POLICY
FOR. EXAMPLE IF THERE'S A
MACHINE SHOP ON THE FARM AND
THE SHOP IS RENTED TO AN
INDIVIDUAL WHO USES TO SHOP TO
OPERATE A MECHANIC BUSINESS.
THE INSURED WOULD NEED A
COMMERCIAL PROPERTY FORM SINCE
THE ACTIVITY IS NOT CONSIDERED
A FARMING OPERATION BUT A
BUSINESS ACTIVITY. THEN OVER
LAYING ALL THIS TO FURTHER
COMPLICATE THINGS. WE HAVE
ANOTHER ELEMENT OF INSURANCE
FOR FARMS AND RANCHES AND
THAT'S CROP INSURANCE. AND CROP
INSURANCE IS A SPECIALTY LINE
OF INSURANCE SOMETIMES SEPARATE
FROM A FARMER RANCH POLICY BUT
NOT ALWAYS NECESSARILY
NECESSARILY THE CASE. AND THAT
IS PURCHASED BY AN AGRICULTURAL
PRODUCER. TO PROTECT AGAINST
EITHER THE LOSS OF CROPS DUE
TO. NATURAL DISASTERS FOR LOSS
OF. REVENUE DUE TO CLIENTS ARE
DUE TO DECLINES. IN THE PRICE
OF AGRICULTURAL COMMODITIES. SO
NOW. TO BRING THIS REALLY FULL
CIRCLE. CALIFORNIA FARM CAL.
FAR AND RANCH ARE LEFT IN LURCH.
PRACTICAL PROPERTIES ARE PRONE
TO EXIT THE SAME REST. IS ALL
OTHER RESIDENTIAL AND
COMMERCIAL PROPERTIES. AND ARE
SUBJECT TO THE SAME NON
RENEWALS IS ALL OTHER POLICY
HOLDERS. THE KEY DIFFERENCE IS
THAT THE FARMER THE RANCHES
UNABLE TO ACQUIRE THE COVERAGE
OF LAST RESORT DUE TO STATE
LAW. SO THE SOLUTION AND NOT
NECESSARILY THE LONG TERM
SOLUTION. IS TO CLARIFY THE
CALIFORNIA FAIR PLAN IS
AUTHORIZED TO UNDERWRITE
POLICIES FOR AGRICULTURAL
PROPERTY. BY PROPERTY I MEAN
THE INFRASTRUCTURE THAT IS
PERMANENTLY AFFIXED TO THE
LAND. AND UTILIZED FOR THE
PRODUCTION OF AGRICULTURAL
AGRICULTURAL COMMODITY. VERY
BROAD DEFINITION WHAT
ENCOMPASSES ALL AGRICULTURAL
OPERATIONS ALLOWING FARMS AND
RANCHES AND WINERIES AND
DAIRIES HAVE BASIC PROPERTY
INSURANCE. THERE AND IN MOST
CASES. THESE AGRICULTURAL
OPERATIONS CAN THEN STAFF OR
LAYER ADDITIONAL INSURANCE
COVERAGE IF NEEDED ON TOP OF
THE FAIR PLAN POLICY TO FURTHER
MITIGATE THEIR OWN RISK. THE
SOLUTION IS WHAT THE CALIFORNIA
FAIR PLAN THE CALIFORNIA FARM
BUREAU THE PERSONAL INSURANCE
FEDERATION OF CALIFORNIA AND
THE AMERICAN PROPERTY CASUALTY
INSURANCE ASSOCIATION I'VE BEEN
WORKING ON FOR THE PAST SEVEN
MONTHS. MY ORGANIZATION
APPRECIATES THE SON GOT ON
GOING DIALOGUE THE NEGOTIATION
TO FIND REALLY A SOLUTION THAT
WORKS FOR THE AGRICULTURAL
COMMUNITY. SENATE BILL LEVIN IS
THE VEHICLE THAT ENCOMPASSES
THESE DISCUSSIONS AND WE'RE
EXCITED THAT- THE CHAIR HAS
MADE THIS BILL ONE OF OUR TOP
PRIORITIES THIS YEAR. WE ALSO
APPRECIATE THE CONVERSATIONS
WITH OUR PARTNERS AT THE
CALIFORNIA DEPARTMENT OF
INSURANCE AS WE FURTHER DISCUSS
THE APPROPRIATE MEANS TO
ADDRESS OTHER INSURANCE
AVAILABILITY AND AFFORDABILITY
ISSUES. ALL IN MY COMMENTS
THERE AND APPRECIATE THE
OPPORTUNITY TO BE INCLUDED
TODAY- I'M HAPPY TO TAKE ANY
QUESTIONS FROM MEMBERS OF THE
COMMITTEE AND THANK YOU VERY
MUCH. THANK YOU MR SPIEGEL I
WILL NOW TURN IT OVER TO MEMBER
QUESTIONS. ANY QUESTIONS. I
WILL GO TO MISTER DOT. I YES- I
JUST WANT TO THANK BOTH
SPEAKERS I REALLY DON'T HAVE
AYE AYE I DID HAVE EXTENSIVE
QUESTIONS- FOR A- LINNEA- MR
QUINN DAVIDSON WHO- BY THE WAY
YOUR DURING ALL THESE THINGS
I'VE BEEN A ON PANELS WITH HER
AND- IT'S NOT SURPRISING TO ME
SHE ANSWERED ALL MY QUESTIONS
IN HER PRESENTATION THAT'S HOW
GOOD SHE REALLY IS ON THIS
STUFF AND I'VE REALLY
APPRECIATED HER- HELPING
GUIDANCE THROUGH WHAT. THE OF
THE SITUATION WE DON'T HAVE
MANY EXPERTS IN THESE
PARTICULAR AREAS BECAUSE
THEY'RE ALL MAYBE NOT SO NEW
BUT THERE. WELL BECAUSE OF ALL
THE FIRE DAMAGE AND EVERYTHING
WE'VE HAD THE STATE IT'S
HIGHLIGHTED THEIR IMPORTANCE IN
WE JUST NEED MORE OF HER AND I
THINK THAT ALSO- MR SPIEGEL
REALLY SPOKE VOLUMES TO- THE
IMPORTANCE OF MAKING SURE THAT
OUR- COMMERCIAL FARMS IN IN THE
STATE OF CALIFORNIA CAN SOME
WAY SOMEHOW CONTINUE- WITH
INSURANCE COVERAGE THANK YOU
MANAGER. THANK YOU SENATOR
DODD- FOR ME I WANT TO JUST
TAKE A MOMENT TO THINK- THE
PANELISTS AT MRS QUINN DAVIS
AND JUST FOR CERTIFYING BURKE
BOSSES BUT SOMETHING THAT SHE
SHARED WAS STRIKING TO ME- SHE
SHARED THAT THERE WERE TWENTY
THREE THOUSAND BURNS. THAT
RESULTED- IN ONE ONE LAWSUIT
AND I GUESS THERE IS AN ISSUE
OF MISS. PERCEPTION HERE
BECAUSE- THAT'S SOMETHING THAT
I BELIEVE MR DOG AND I HAVE
DISCUSSED AT LENGTH IN TERMS OF
WHAT'SNEEDED BUT THAT
INFORMATION WAS REALLY
IMPORTANT TO HEAR AND WE
APPRECIATE THE INFORMATION I
ALSO WANT TO THANK MR SPIEGEL
BECAUSE- I CLEARLY ARE YOU
DON'T COMMERCIAL FARMS ARE
STRUGGLING AS WELL AND SO
HOPEFULLY WE CAN. TAKE THE
INFORMATION WE'VE LEARNED HERE
TODAY TO HELP RESOLVE SOME OF
THESE ISSUES AS A YOU KNOW THEY
DON'T HAVE A BACKSTOP IN TERMS
OF INSURANCE SO THANK YOU BOTH
FOR YOUR INFORMATION HERE FOR
BEING PANELISTS HERE TODAY. AND
WITH THAT- I JUST WANT TO AGAIN
THANK ALL THE PRESENTERS WE'VE
CONCLUDED OUR THREE PANELISTS
UP SESSIONS TODAY- BUT BEFORE I
OPENED IT UP ONE LAST TIME TO
ARM OUR SPEAKERS I JUST WANT TO
SAY THANK YOU TO ALL THE
PANELISTS FOR YOUR PATIENCE AND
I KNOW THEY DID SEEM RUSHED AT
TIMES. UNFORTUNATELY DUE TO THE
PANDEMIC WE HAVE LIMITED TIME
HERE IN THE- CHAMBERS SO THANK
YOU FOR OUR FOR YOU KNOW BE
MORE CONCISE IN YOUR
PRESENTATION AND OUR- OUR
MEMBERS FOR BEING MORE CONCISE
WITH THEIR QUESTIONS- SO NOW WE
WILL GO OVER TO. WILL MOVE ON
TO ANYONE THAT WANTED TO
PROVIDE PUBLIC COMMENT. ARE
THERE ANY WITNESSES HERE IN THE
GALLERY WISHING TO PROVIDE
PUBLIC COMMENT. I SEE ONE. YOU
MAY PROCEED. CAN YOU GET CLOSER
TO THE MINE PLEASE YES MANAGER-
THERE WE GO- CRISTINA KAYLEE ON
BEHALF OF HUMBOLDT MENDOCINO
REDWOOD COMPANY IS A YOU HEARD
FROM SEVERAL OF YOUR PRESENTERS
THE BENEFITS OF PRESCRIBED
FIRE- USAGE AND THE BENEFITS IN
VEGETATION MANAGEMENT- TO
CURTAIL SOME OF THESE MASSIVE
WILDFIRES WE WANTED TO EXPRESS
OUR SUPPORT ONE OF THE MAIN
REASONS WHY THE USE OF
PRESCRIBED FIRE BY PRIVATE
LANDOWNERS- IS SO LIMITED IS
BECAUSE OF THE POTENTIAL FOR
UNLIMITED. FINANCIAL LIABILITY
YES SIR PERMIT CHALLENGES AND
OTHER ISSUES BUT THE MAIN ONE
IS LIABILITY WE THINK THAT IF
LANDOWNERS FOLLOW BEST
PRACTICES PERHAPS CAL FIRE'S
BURN PLAN PROCESS IF YOU FOLLOW
IT ABSENT GROSS NEGLIGENCE
THERE OUGHT TO BE LIABILITY
PROTECTIONS FOR FIRE TRUST PASS
WELL WE TO SUPPORT SENATOR
DODD'S SB THREE THREE TWO AND
ENCOURAGER COMMITTEE TO EXAMINE
THIS ISSUE BECAUSE IT WILL GO A
VERY LONG WAY IN ADDRESSING
SOME OF THE VEGETATION
MANAGEMENT THAT WE HAVE TO DEAL
WITH IN CALIFORNIA. THANK YOU
MADAM CHAIR. THANK YOU WAS
THERE ANYONE ELSE WISHING TO
SPEAK IN THE GALLERY. SEEING
NONE WE WILL NOW TURN IT OVER
TO ROOM ONE TWELVE ANYONE
WISHING TO SPEAK IN ROOM ONE
TWELVE. SCENE NINE WE WILL NOW
MOVE OVER TO OUR WITNESSES
WAITING TO PROVIDE PUBLIC
COMMENT VIA THE TELECONFERENCE
ORVIS MODERATOR IF YOU WOULD
PLEASE PROMPT INDIVIDUALS
WAITING TO PROVIDE PUBLIC
COMMENT WE WILL BEGIN. LADIES
AND GENTLEMEN IF YOU HAVE A
PUBLIC COMMENT PLEASE PRESS ONE
ZERO AT THIS TIME. WELL WAIT
JUST A MOMENT FOR THAT THE
QUEUE UP. THANK YOU.
MY WILL
BEGIN AT LINE TWENTY THREE. BY
KAMALA THE CALIFORNIA
ASSOCIATION UP WINE GRAPE
GROWERS GOOD AFTERNOON AND
THANK YOU CHAIR ALL STAFF
MEMBERS FOR THIS VERY
THOUGHTFUL AND IN DEPTH
DISCUSSION OF A CRITICAL
PROBLEM BOB WE GREATLY
APPRECIATE IT A LOT AND-
OURSELVES WITH THE COMMENTS
FROM THE FARM BUREAU I AM
HEARING SIMILAR CONCERNS FROM
MANY OF THE BLOWERS BINDER
COURSE ROCK CALIFORNIA- EITHER.
DOCTOR MOSER'S OSCAR ROCKETING
UP PREMIUMS ARE INCREASING WORK
HOUSES BE CANCELED ALTOGETHER-
MY DAUGHTER THERE'S JUST ONE
POINT INSURANCE IS NEEDED
BEYOND JUST PROTECTION FROM
LOGGING CHANGES ALSO NEEDED TO
PROVIDE FUNDING AND ONGOING
BASIS IN MANY CASES WHEN IT
WHEN THEY GROW HAPPY ARE.
HEAVILY ON LINE OF CREDIT
THERE'S NECESSARY FOR THE YEAR
THANK THAT ONE CAN ACCOMPLISH
WHAT THE REQUIREMENT THAT THEY
HAVE INSURANCE YOU CAN'T GET
INSURANCE YOU CAN GET A LOT OF
CREDIT FOR THE CRITICAL ISSUE
ONGOING BASIS BUT WITHOUT ANY
OTHER CULTURAL COMMODITY
FRANKLY BUT IT'S A MINOR CHORDS
ESPECIALLY- WE ALSO SUPPORT SB
ELEVEN- STATED BY THE- APART
THAT WE CAN GREAT START WITH
THAT IT'S MUCH NEEDED. AND WE
WILL- ALSO LET CELLS JOHN COM
ABOUT. I MEAN THIS EFFORT AND
THAT WE APPRECIATE YOUR TIME
AND THANK YOU AGAIN VERY MUCH.
THANK YOU- I WANT TO TAKE A
MOMENT TO ASK THE MODERATOR
ASKED HOW MANY. SPEAKERS DO WE
HAVE ON THE LINE. WE CURRENTLY
HAVE FIVE IN Q. OKAY LET'S
CONTINUE LET'S TRY AND KEEP OUR
COMMENTS- CONCISE NEXT CALLER
PLEASE. CHECK OUT WE'LL GO TO
LINE TWENTY SIX. GOOD AFTERNOON
MADAM CHAIR AND COMMITTEE
MEMBERS I'M ERIN I THINK YOU'RE
AMERICAN BANKING A TREE CARE
INDUSTRY ASSOCIATION THE
ASSOCIATION HAS ABOUT TWO
HUNDRED AND TWENTY VEGETATION
MANAGEMENT COMPANY OF. THAT
WORK IN CALIFORNIA INCLUDING A
COUPLE OF LARGE RECOGNIZABLE
NAMES SUCH AS DAVEY TREE AND
RIGHT CERVANTES CORPORATION.
I'VE YOU'VE HEARD FROM THE
INCREASE DEVASTATING
DESTRUCTIVE WILDFIRE SEASON YOU
I HAD A MAJOR IMPACT ON THE
COMMERCIAL INSURANCE MARKET.
TWO THOUSAND ELEVEN TREE CARE
COMPANIES HAVE SEEN THEIR
LIABILITY INSURANCE PREMIUM.
INCREASE AT THE SAME TIME THE
COVERAGE IS ACTUALLY DECREASED
WITH THESE CHANGES DEEPENING
FROM TWO THOUSAND SEVENTEEN.
COMPANIES WORK IN A
PARTICULARLY HIGH RISK
ENVIRONMENT OF THESE COMPANIES
OFTEN CONTRACT WITH OUR COMPANY
TO ENSURE TRANSMISSION AND
DISTRIBUTION LINES ARE FREE
FROM BY TH PATIENT. WE REALLY
APPRECIATE YOUR ATTENTION TO
THIS IMPORTANT ISSUE OUR
COMPANY HAS CONTINUED TO DO
ONGOING IMPORTANT VEGETATION
MANAGEMENT WORK TO REDUCE
WILDFIRE RISK AND WE HOPE TO
CONTINUE PARTNERING WITH THE
LEGISLATURE AND THE COMMITTEE.
AS PART OF THE SOLUTION THANK
YOU. THANK YOU FOR NEXT CALLER
PLEASE. NEXT WILL BE A LINE.
FOURTEEN THANK YOU MADAM CHAIR
VICE CHAIR JONES MEMBERS
MICHAEL GUNNING HERE WITH THE
CALIFORNIA BUILDING INDUSTRY
ASSOCIATION I JUST WANT TO
THANK YOU MADAM CHAIR FOR
HOLDING THIS HEARING ON THIS
VERY IMPORTANT ISSUE
AVAILABILITY OF COMMERCIAL
INSURANCE- I WANT TO GO ALL THE
COMMENTS OF THE PRESENTERS FOR
ILLUMINATING THE NAME ISSUES
WE'RE TALKING- REPRESENTS THE-
STATE'S APPROXIMATE THREE
THOUSAND. AND HOME BUILDERS AND
LAND DEVELOPERS IN THE HOLE IN
THE CONSTRUCTION INDUSTRY. AND
WHAT WE'RE SEEING HAS TO DO
WITH A MULTI FAMILY HOUSING
SPECIFICALLY A HOMEOWNERS
ASSOCIATIONS AND THE COST OF A
COMMON AREA PROPERTY INSURANCE-
SOME OF OUR MEMBERS ARE FINDING
IT NEAR IMPOSSIBLE TO ENSURE
THEIR MULTI FAMILY HOUSING
PROJECTS. WHICH MAKES IT EVEN
MORE DIFFICULT AS YOU CAN
IMAGINE TO ADDRESS A HOUSING
SHORTAGE WHAT'S MORE
INTERESTING IS THAT THIS
HAPPENS IN SPITE OF THE FACT
THAT THE PROJECT PROJECTS MEET
AND EXCEED THE CURRENT
ESTABLISHED WHAT FIRE SAFETY
BUILDING STANDARDS. AND MAY
EVEN BE PART OF A LONG TERM
SOLUTION BUT INSURANCE
COMPANIES ARE UNWILLING TO TAKE
ON NEW POLICIES FOR MULTI
FAMILY COMMUNITIES. IN LIGHT OF
THE FIRE RISK ASSESSMENTS THAT
WE'VE ALL HEARD ABOUT TODAY. I
THINK IT'S LIKE AARON SUGGESTED
CONCERT DOUBLING TRIPLING BEING
DROPPED- RAISED WITHOUT. NOTICE
WHAT YOU OF THIS OF COURSE AND
WE ARE KNOW THE IS AFFECTING
SENIOR LOW INCOME IN THE- SOME
POTENTIAL HOME. SO WHILE WE
COMMEND THE PART WITH
COMMISSIONER LAW AND THE NEW
AMENDMENT. TO LOOK AT SOME OF
THESE RISKS IN WE THINK THAT
THE SOLUTION OKAY COME OUT OF
THAT. I THINK WE WANT TO ECHO.
MISTER COMMON ABOUT AND USE
THAT MIGHT BE THE WAY BECAUSE
IT SEEMS LIKE RATE FILINGS ARE
NOT BEING APPROVED. AND WE NEED
TO GET SOME GREAT OUT HERE SO
INSURERS CAN BEGIN TO ENSURE
AGAIN SO WITH THAT I'LL STOP
THANK YOU MADAM CHAIR MISTER
VICE CHAIR. THANK YOU FOR YOUR
AND NEXT PLEASE. NEXT THE.
TWENTY FOUR. WITH THERE ARE AT
LAW LET JERRY THIS IS THERE ARE
A LOT WITH INTRINSIC INSURANCE
SERVICES I'M A BROKER IN THE
AREA THAT SPECIALIZES IN THE
HIGHSPIRE RASH AND WHAT WE'RE
SEEING BY TALKING TO THE
INSURANCE COMPANIES AND THAT
THERE IS NO CURRENT PUSH FOR
THEM TO COME OUT WITH ANY D. IC
FILINGS FOR COMMERCIAL ON
FARMS. BECAUSE THERE'S NOT THAT
NECESSARY COVERAGE THROUGH AND-
CALIFORNIA PLAN. SO WHAT WE'VE
BEEN LOOKING OUT AS IT IS
LOOKING AT THE INSURANCE CODE
IN THE STATE OF EMERGENCY IN
SOMEBODY ELSE'S STATED ON HERE
WE'VE SEEN THIS YEAR THAT WAY.
THE WILL IS THERE THAT LOCK
THOSE LAWS CAN BE OVERTURNED
FOR THE PUBLIC HEALTH AND
SAFETY AND THIS IS DEFINITELY
TURNING INTO THAT. SO WE NEED
TO JUST LIKE PROP ONE OH THREE
WITH UNENDING GENDERS WE NEED
TO MAKE IT SO THAT THE
INSURANCE COMPANIES HAVE TO
COME UP WITH THE ICY FILING
THAT THE PORTANTINO COMMERCIAL
ON FARMS. AND THEN EXTRADITED
THROUGH THE DEPARTMENT OF
INSURANCE THAT WE DON'T END UP
IN A REACTIONARY NOT THAT LIKE
WE DID WITH THE HOMEOWNER'S
POLICIES. WE THERE'S A LOT OF
STEPS THAT NEED TO BE TAKEN WE
KNOW THAT WE GET THIS THROUGH-
RIGHT NOW WHAT WE'RE SEEING IS
EVERYBODY TALKING ABOUT HOW WE
GOT HERE WHEN EVERYBODY KNOWS
HOW WE GOT HERE THAT HE KEEPS
CATCHING ON FIRE. WE'RE NOT
DOING ENOUGH TO TAKE THAT
COURSE INSURANCE COMPANIES TO
COME UP WITH SOMEBODY SOLUTION.
TO HELP GET THEM BACK ON THE
MARKET. THANK YOU FOR YOUR
INPUT NEXT CALLER. NEXT
DEADLINE. TWENTY SEVEN. RUBIO
MEMBERS THIS IS CHRIS ROSA ON
BEHALF OF CALIFORNIA'S THE
CALIFORNIA FORESTRY ASSOCIATION
THANK YOU SO MUCH FOR CONVENING
THIS IMPORTANT HEARING WE'D
LIKE TO HIGHLIGHT- WILD FIRE
EXCLUSION- WILDFIRE EXCLUSIONS
ARE BECOMING THE NORM WHEN
INSURANCE POLICIES ARE UP FOR
RENEWAL SO IN ADDITION TO
SKYROCKETING RISING PREMIUMS
OUR MEMBERS ARE BEING TOLD THAT
DESPITE ALL OF THE WORK THAT
THEY'RE DOING TO MITIGATE. THE
RISK OF ACCIDENTAL FIRE
ASSOCIATED WITH THEIR REGULAR
TIMBER HARVEST THE OPERATION
THE INSURANCE INDUSTRY HAS
EXCEEDED ITS CAPACITY FOR
WILDFIRE RISK AND THEREFORE
WILL NOT OFFER WILD FIRE
COVERAGE DESPITE THE LOW RISK
PROFILE OF OUR MEMBERS SHOW UP
EQUAL IMPORTANCE IS THE LACK OF
LIABILITY COVERAGE FOR
PRESCRIBED BURNING ACTIVITIES
AS YOU KNOW THE ROLE OF
PRESCRIBED FIRE OR GOOD FIRES
AS WE CALL THEM IS FRONT IN
CENTER IN DISCUSSIONS
CONCERNING FOREST HEALTH. AND
WILDFIRE RESILIENCY HOWEVER
DESPITE ALL OF THE GOOD WORK
THAT HAS ALREADY BEEN DONE AND
THE GOALS OF INCREASING THE USE
OF PRESCRIBED FIRE THAT'S LAID
OUT IN THE GOVERNOR'S WILDFIRE
COURSE RESILIENCY ACTION PLAN
IT'S UNLIKELY THAT COMMERCIAL
OPERATORS AND PRIVATE
LANDOWNERS WILL EVEN BE ABLE TO
USE THIS TOOL OF PRESCRIBED
FIRE WITHOUT ACCESS TO
IMPORTANT LIABILITY COVERAGE.
SAID AGAIN THE PROBLEM OF
INSURANCE FOR PART CRIED FIRE
IT'S OF CRITICAL IMPORTANCE AND
WE ASK FOR YOUR PRIORITIZATION.
AT THIS ISSUE THANK YOU. THANK
YOU FOR YOUR EMPIRE NECK CALLER.
NEXT DEADLINE. TWENTY GOOD
AFTERNOON CHAIR- RUBIO AND
NUMBERS- THIS IS TIM SMALL
DINNER WITH WINE INSTITUTE- I
JUST WANT TO TAKE A MOMENT TO-
EXTEND MY APPRECIATION TO THE
SHARE FOR PUTTING TOGETHER A
GREAT HEARING. BEEN VERY
INFORMATIVE FOR ME AND FOR OUR
INDUSTRY- INSURANCE ISSUES HAVE
BEEN RISING TO ONE OF THE TOP
OF OUR AGENDA ITEMS- AND
WANTING TO WE ARE. LITERALLY
THE ENTERPRISE- BY CONCERNS
ABOUT FROM OUR MEMBERS
RELIGION- BOTH TO AVAILABILITY
AND COST OF INSURANCE- BUT
ALSO- THE PREVIOUS SPEAKER
MENTIONED- THE BILITY. TO
CONDUCT- PREVENTATIVE BURNS AS
WELL- WE ARE SUPPORTIVE OF ALL
EFFORTS TO ADDRESS THE
SITUATION- WE ARE SUPPORTED BY
THE EARLY BUDGET OPTIONS-
REGARDING WILDFIRE PREVENTION-
WE WILL BE SUPPORTING SENATE
BILL ELEVEN. AND APPRECIATE THE
EFFORTS THERE AND WE LOOK
FORWARD TO SUPPORTING MANY OF
THE BILL BEFORE THE
LEGISLATURE- DEALING WITH WITH
THIS ISSUE. AND I WANT TO
EXTEND A SPECIAL CREATION FOR
SENATOR DODD- HIS ATTENTIVENESS
TO THIS ISSUE WITH REALLY
APPRECIATED. BY THE INDUSTRY
AND THE WE SHOULD ALL THAT
COME- MADE TO. AND ALSO THAT OF-
PREVIOUS SPEAKERS THANK YOU.
THANK FOR YOUR INPUT MODERATOR
CAN YOU PLEASE- GIVE ME TOTAL
NOW OF WAITING. ARE THERE ARE
NO FURTHER COMMENT AT THIS TIME.
I WANT TO THANK ALL THE COLORS
FOR YOUR INPUT AND DATA FOR
BEING CONCISE. I THINK THAT
THERE IS NO OTHER COMMENTS ARE
ONCE AGAIN I WANT TO EXTEND MY
THANK YOU TO MR DOT I KNOW IT'S
LATE AND HE'S BEEN PATIENT
WAITING HERE WITH ME. I THANK
YOU TO ALL THE INDIVIDUALS THAT
CALLED ALL THE PANELISTS IT HAS
BEEN REALLY INFORMATIVE EVEN
FOR MYSELF. AND DIE IN AND ONCE
AGAIN JUST WANTED TO ALSO THINK
THE INSURANCE COMMISSIONER FOR
ALLOWING- HIS STAFF TO TESTIFY
AS WELL AS WHAT YOU KNOW
BRIEFING US PRIVATELY. ALL OF
YOUR COMMENTS AND SUGGESTIONS
ARE REALLY IMPORTANT TO ALL OF
US INCLUDING- ABDO'S THAT WERE
RECORD IF YOU FEEL THAT YOU
DON'T GET AN OPPORTUNITY TO
CALL IN AND YOU WANT YOUR
TESTIMONY ON RECORD PLEASE DO
SO. REACH OUT TO MY OFFICE OR
GO ON THE WEBSITE THANKYOU AND
WE APPRECIATE HE ONCE AGAIN AND
THANK EVERYONE THAT COMMITTEE
ON INSURANCE IS ADJOURNED.