As part of his Sustainable Insurance Strategy, California Insurance Commissioner Ricardo Lara has released the final draft of his modeling and ratemaking regulations for public review and comment. The proposal would allow insurers to use forward-looking catastrophe models when setting their rates in exchange for binding commitments to writing policies in areas of the state that have experienced high rates of policy non-renewals. Comments on the proposal, which was released on August 16, are due on September 17, 2024, with a virtual hearing scheduled the same day.
The Commissioner also implemented reforms with the intent to streamline the process by which rate filings are reviewed by the Commissioner’s office. The reforms, which were originally proposed by Governor Gavin Newsom as part of the state budget trailer bill process, place hard deadlines on the office of the Commissioner to increase the speed of the rate review process. Combined with proposed regulations to increase clarity on the rate filing process for insurers, the reforms are intended to give increased certainty to consumers, insurers and everyone involved in the rate filing process.
For more information on the modeling and ratemaking proposal, including instructions on filing comments, visit the Department of Insurance website. Contact RCRC Senior Policy Advocate, Staci Heaton, for more information.