Most of us that work in personal lines recognize that both the FAIR Plan and homeowner’s insurance in California have both had very serious problems. These problems have become more prominent in the past year, as very expensive wildfires have nearly devastated the state, while more private insurance agencies leave or stop providing coverage for fire-prone areas.
Starting next month, it appears that *many* changes are taking place to begin addressing these issues. These changes are (hopefully) only the beginning, but may have wide reaching impact not only on insurance, but homeownership in general. For example:
- The state is likely to expand the FAIR Plan to larger commercial properties.
- The state is going to be required to disclose information about the program, helping guide lawmakers and potentially provide more funding.
- The state is going to look at stabilizing the homeowner’s insurance market so private insurance stays active.
- The state is likely to offer better smoke insurance coverage, to address a lawsuit that found their denied claims were illegal.
- The state is likely to seek more funding for the FAIR Plan to address budgetary constraints.
Commissioner Lara’s language about the FAIR Plan has been harsh and strong, so it’s possible that even more sweeping changes are underway as insurance agencies and California residents look to adjust to the California climate.
Agents should always pay attention to any changes to the market, because all changes represent opportunity – opportunity to inform clients and build trust, opportunity to offer different services, and more. Watch to see what, if anything, happens with the California FAIR plan, and then think about all the ways that you can use it to help customers and find new ones.
Not yet licensed to provide homeowner’s insurance? Expand what you can offer by completing your licensing classes here at LyteSpeed Learning.