Sunday, 14 August 2022

Levine calls for $10 billion wildfire budget action to increase defensible space, lower insurance premiums

SACRAMENTO — As Gov. Newsom prepares for his May budget revision with estimated surplus funds potentially exceeding $68 billion, Assemblymember Marc Levine (D - Marin County) on Monday announced a $10 billion budget request that would invest $5 billion to incentivize home hardening in high wildfire risk areas and an additional $5 billion to establish a state Catastrophic Wildfire Reinsurance Fund.

These two requests are essential to prepare and respond to the year round wildfire risk that threatens families and homes across California.

The climate crisis has redefined California’s approach to wildfire prevention and mitigation efforts necessary to stop widespread loss of life and property.

Thanks to California’s resilient economy, the current estimated budget surplus presents a number of opportunities to make lasting investments and prevent future destruction resulting from wildfires.

Homeowners, especially those in rural or suburban communities are in dire need to reduce their own risk of wildfire by increasing defensible space around their home.

A homeowner that invests in science-based home hardening stands a higher chance of surviving a wildfire than homes that do not. Large-scale home hardening is an essential tool to reduce wildfire-caused losses now and into the future.

Levine’s $5 billion budget request will incentivize science-based home hardening by offering homeowners grants of up to $10,000 to reduce a homeowner’s wildfire risk and reduce the potential spread of wildfires in high-risk fire zones across California.

As has been demonstrated over the past several years, insurance companies are canceling or non-renewing insurance policies, raising premiums, or threatening insolvency due to increased wildfire risks in California.

Levine’s additional $5 billion request would establish the Catastrophic Wildfire Reinsurance Fund, a state administered reinsurance program to provide a stable and ongoing source of reimbursement to insurers for catastrophic wildfire losses.

This fund, based on Levine’s legislation, AB 1522 (2022), will be the last line of insurance protection and will cover all insured losses over a certain amount occurring during the annual wildfire season.

As wildfires become larger and more destructive, no insurer or financial entity in the future will be willing to assume wildfire liability risks unless the state of California can provide a framework and structure to limit exposure and bring stability and predictability to the California property insurance market. Levine’s $5 billion request will stabilize the insurance marketplace and increase the availability of comprehensive, affordable property insurance.

“We have to do more than the bare minimum as California wildfires become hotter, faster and more devastating,” said Assemblymember Marc Levine. “We must harness our state’s economic health to make lasting investments that will reduce homeowner risk to wildfire loss and help to stabilize the insurance marketplace. This $10 billion investment is a necessary down payment as part of our state’s broader work to address the climate crisis and the devastating economic impacts of wildfires in California and should be included in the 2022-23 Budget Act.”

Levine’s budget request will be considered as part of the 2022-23 state budget.

A copy of Levine’s $10 billion wildfire budget request to legislative leaders is published below.

Wildfire Budget Request 5-9-22.Docx by LakeCoNews on Scribd

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