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Read all of the PD's fire coverage here

SACRAMENTO — A state Senate committee approved two measures Wednesday night that would bring relief to fire victims who lost their homes in October, despite opposition from the powerful property-and-casualty insurance industry.

The Senate Committee on Insurance approved by an 8-0 vote separate measures by state Sens. Mike McGuire, D-Healdsburg, and Bill Dodd, D-Napa, to help local constituents. The bills will head to the Senate floor if McGuire and Dodd can reach agreement with committee chairman Steven Glazer, D-Orinda, who expressed reservations with both pieces of legislation.

“We have to hit the sweet spot,” Dodd said after the votes.

Fire victims, representatives of building trades, firefighters and people from community organizations joined Santa Rosa Mayor Chris Coursey and Board of Supervisor Susan Gorin speaking before the committee, relating their personal struggles and why the measures were needed.

Local homeowners have found themselves underinsured in the wildfire aftermath as well as being burdened by filling out home inventory lists to get reimbursed for personal property destroyed in the fires. More than 6,100 homes in the region were destroyed or damaged.

The insurance industry argued the two measures would have unintended consequences, likely triggering higher rates for all consumers and less competition for the more than 8 million California homeowners. They also believe the changes should not apply retroactively to last year’s wildfires.

Committee members appeared more sympathetic to McGuire’s bill, Senate Bill 897, which would require carriers to pay out at least 80 percent of the maximum limit under a homeowner’s personal property coverage without requiring policyholders to itemize losses. The provision would be triggered in the aftermath of a declared disaster area.

The measure would apply retroactively to those who filed claims in the October fires, which have triggered about $10 billion in insurance claims in the North Bay.

“The thousands of residents who lost their homes from last year’s wildfires could not have imagined that they would be soon forced to relive this tragedy by producing an inventory of everything that they lost,” McGuire said.

Coursey spoke of “arcane and unfair” insurance rules in the recovery effort, while Gorin, who lost her Oakmont home, said “we are ill equipped to really understand the insurance industry.

“We’re reeling,” she said.

Kara Cross, general counsel for the Personal Insurance Federation of California, argued that the 80 percent benchmark would be “a one size fits all” solution that would be inconsistent with insurance contracts.

“It is going to increase price again and limit choices available to policyholders,” Cross said.

The 10 largest insurers in the North Bay all have paid out at least a 50 percent level to fire victims, with four carriers paying out 100 percent on personal property losses without a detailed inventory.

Glazer said he worried the 80 percent threshold was too high, and proposed a 50 percent level that he said seemed fair to fire victims as well as carriers.

McGuire, however, complained the industry was not negotiating in good faith and only recently offered a 25 percent level.

“They don’t want this bill to move forward,” he said.

The Dodd bill, Senate Bill 894, would allow policyholders to combine the maximum amount for different coverage areas — such as their primary dwelling, other structures, contents and living expenses — to pay for any of the covered uses. The provision would apply to only those in declared disaster areas.

Read all of the PD's fire coverage here

Insurance companies contended the legislation would drive up costs because policyholders are not entitled to full policy limit payouts even after a total loss.

“It’s going to impact all Californians,” Cross said.

The Dodd measure also would expand the insurance coverage for rental living expenses from two years to three, and increase from one year to two the length that carriers would be required to renew a homeowner policy in the aftermath of such disasters.

You can reach Staff Writer Bill Swindell at 707-521-5223 or bill.swindell@pressdemocrat.com.

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