New California regulations go into effect later this year to help homeowners get complete and reliable information about home insurance so they aren't caught short on coverage when tragedy strikes.
The regulations, approved by the state's Office of Administrative Law on Dec. 29, will go into effect June 27. They require insurance agents and brokers to complete training on home insurance valuation, and they set standards for how replacement cost estimates must be completed. Insurers, agents and brokers must provide replacement cost estimates to homeowners and document how they were calculated.
In one of his last press statements before leaving office, outgoing Insurance Commissioner Steve Poizner said the new rules were part of a larger effort he spearheaded to combat underinsurance.
"Early in my tenure, I witnessed the problem of underinsurance when I toured the site of the San Diego wildfires. I promised then that I would address the problem of underinsurance, and with the approval of these regulations I believe I have fulfilled that promise," he said in a press statement. "Consumers face several complicated choices when buying homeowners insurance and they need reliable and complete information in order to make good decisions. These new regulations deliver on both of those fronts.
Poizner also worked with the Legislature to pass a bill last year that makes the California Residential Property Disclosure Form more accurate and easier to understand.
California has suffered the most damaging consecutive wildfire seasons on record in the last four years. Five of the 20 worst fires in state history, measured in acres burned and structures destroyed, occurred in 2007 and 2008. Almost 1 million Californians were forced to evacuate their homes in 2007, the largest evacuation in the state's history.
Poizner's term as insurance commissioner ended Dec. 31. He ran for the Republican nomination for California governor last year but lost to Meg Whitman. Democrat Dave Jones is the new California insurance commissioner.