Let’s Talk Insurance!

On April 6, the Mariposa Democratic Club hosted Richie M. Sayavong, Outreach Analyst for the California Department of Insurance. He discussed the current insurance situation in Mariposa County and throughout California. This was a community-wide meeting  and was well attended.

Sayavong described the current insurance marketplace, insurance rate issues, and the California FAIR plan. He provided background on the Department of Insurance and an update on Insurance Commissioner Ricardo Lara’s “Sustainable Insurance Strategy,” and the “Safer from Wildfires” initiative.

Sayavong explained that in 1988, Proposition 103 required homeowner’s insurance increases be capped at 6.9%. However, climate change, drought, and housing and business development have changed California’s wildfire risk. 

Prop 103 did not regulate California FAIR Plan rates.  Prop 103 may also explain the frequency of homeowner’s insurance non-renewals. If insurance companies can’t make a “fair return” with capped rates, they can issue notices of non-renewal and force ratepayers onto the California FAIR Plan as the only alternative for fire insurance.

Sayavong noted that the Department of Insurance cannot dictate insurance rate increases nor prevent non-renewal notices. He pointed out that the FAIR Plan is not a state agency nor a public utility. It does not have a cap on what it can charge nor does it, (or any insurance company), need to explain why they raise rates or why they issue notices of non-renewal.

Sayavong said that most of the insurance companies are not leaving California — they are “pausing” homeowners insurance policy sales until they are able to recover losses from the catastrophic fires California experienced in the last few years.

The Insurance Commissioner, Ricardo Lara, is negotiating with insurance companies to develop a more “Sustainable Insurance Strategy.” (See handout below.) Sayavong made several points to explain this strategy.

First, the Insurance Department will require insurance companies to write policies for no less than 85% of the homes and businesses in distressed areas. 

Second, they are negotiating the return of FAIR Plan policyholders to the regular insurance market, using “Safer from Wildfires,” regulation. (See handout below.)

Third, new rate models will recognize mitigation and hardening requirements to appropriately price rates. This is presently not  part of price setting in the insurance market. (See the link to the Home Hardening booklet below.)

Finally, Commissioner Lara wants to have a “California Only” cost plan to protect California consumers from covering the costs of other global catastrophes.

Following the presentation, there were questions and comments from attendees. There was a high level of engagement and frustration with the current insurance situation. Mr. Sayavong; District 1 Supervisor Rosemarie Smallcombe; Steve Smallcombe, chair of the Mariposa County Democratic Central Committee; and Suzette Prue responded to questions.

A critical point is that Californians must “harden” their homes to wildfires. A booklet that can be used to explain home hardening and offer guidance is available from the Mariposa County Resource Conservation District (MCRCD).  Here is a link to the MCRCD’s “Wildfire Home Retrofit Guide — How to Harden Homes against Wildfire”

https://www.mcrcd.net/wp-content/uploads/2022/12/LWF_RetrofitGuide_Accessible_for_Web-1.pdf

Sayavong’s presentation and the handouts provided at the Meeting are available below. 

If you have questions, comments, or complaints for the Insurance Commissioner or Richie Sayavong, call the Commissioner’s office at 800-927-4357.  You can find more information at insurance.ca.gov.

Sayavong’s Powerpoint Presentation

Handouts Provided by Sayavong for the Department of Insurance

June is Pride Month! Learn More…

In anticipation of Pride month, the Mariposa Democratic Club will host Kate Hall, leader of Mariposa Pride efforts and events, at our May 11 meeting. She’ll discuss plans for June Pride events in Mariposa and how the Club can support those efforts. In particular, the Club wants to ensure that this year the Board of Supervisors proclaims June Pride month and designates a June Pride day.

Education Awards!

In conjunction with the Mariposa County Democratic Central Committee, the Mariposa Democratic Club has funded and supported two education awards this year. The winners of the $750 awards will be recognized at the May 11 Club meeting and will read the essays they wrote to win the award. Join us in recognizing and congratulating the winners at this meeting.

Join Us!

The Mariposa Democratic Club plays a very active part in the local community. And, we’re always looking for citizens who want to join us and support our efforts. If you’d like to be a member, go here to fill out a membership form.

The Mariposa Democratic Club works to defend our fundamental freedoms!