The two Democrats running to be California's next insurance commissioner faced off in a CalMatters-moderated debate Thursday, and their answers to the state's home insurance problems could hardly be further apart.
Former San Francisco Supervisor Jane Kim wants the state to run its own disaster insurance. State Sen. Ben Allen of Los Angeles wants to push insurers, homeowners and governments into a statewide effort to cut wildfire risk, which he says would bring prices and availability back in line.
Kim said on stage that Allen offers to "tinker" with the status quo; Allen called her plan "totally unprecedented and unmoored," CalMatters reported.
What the job controls
The commissioner runs the state Insurance Department, which approves what insurers may charge for home, auto, renters, commercial, pet and travel coverage and investigates how companies treat customers. After several insurers stopped writing or renewing policies in high fire-risk areas, many homeowners landed in the FAIR Plan, the state's insurer of last resort, which generally costs more and covers less.
Rules adopted last year by outgoing Commissioner Ricardo Lara speed up rate reviews and let insurers build reinsurance costs and catastrophe modeling into what they charge. Insurify, a comparison site, estimated that California homeowners rates climbed 5% from January through June.
Two plans
Kim's proposal would split fire and flood coverage off into a state-run program paid for with premiums people already pay, while letting them keep their current policies. She has cited New Zealand's public system as a model and wants to expand the state's low-cost auto insurance program for low-income drivers.