California Weighs Mandate for Insurers to Cover Wildfire-Ready Homes

Proposal aims to ensure insurance availability for homeowners who take steps to reduce fire risk.

Published on Feb. 28, 2026

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As wildfires continue to impact communities in California's North Bay region, state officials are considering a legislative proposal that would require insurance companies to offer policies to homes that meet official wildfire risk reduction standards. This comes as insurers have become increasingly selective about the properties they will cover, often refusing to insure older homes or those in high-risk fire areas.

Why it matters

Insurance is a critical part of the economy, but insurers have faced challenges in California due to the rising costs of wildfire claims. The proposed mandate aims to ensure insurance availability for homeowners who have taken steps to make their properties more fire-safe, incentivizing risk reduction efforts across the state.

The details

The pending legislative proposal would change the current system where insurers are free to pick and choose which homes and businesses they will insure. Under the new rules, insurers would be required to offer policies to properties that comply with official wildfire risk reduction standards, even if those properties are located in high-risk areas. This is similar to the Affordable Care Act's ban on health insurers rejecting applicants with pre-existing conditions.

  • In 2023, State Farm paused issuing new policies in California, signaling insurers' concerns about adequate rates.
  • California's Department of Insurance has since launched the Sustainable Insurance Strategy to address insurers' claims and improve policy availability.

The players

Amy Bach

Executive director and cofounder of United Policyholders, a nonprofit that advocates for insurance consumers and helps improve disaster preparedness.

Ricardo Lara

Commissioner of the California Department of Insurance, who launched the Sustainable Insurance Strategy.

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What they’re saying

“When the Affordable Care Act barred health insurance companies from rejecting applicants with preexisting conditions, our country took a major step forward to restore the pooling and risk spreading mechanism that makes policies affordable and available.”

— Amy Bach, Executive director and cofounder, United Policyholders (pressdemocrat.com)

What’s next

The California legislature is expected to consider the proposal to require insurers to offer policies to wildfire-prepared homes in the coming months.

The takeaway

This potential mandate highlights the delicate balance between insurers' profitability concerns and the need to ensure affordable, accessible insurance coverage for homeowners who have taken proactive steps to reduce their fire risk. The outcome could have significant implications for communities in fire-prone regions of California.