Regulatory Update

The following update may be of interest to attorneys practicing insurance law:

EXTENSION OF EMERGENCY DECLARATION

On July 11, 2025, the CDI issued a Notice extending the declaration of emergency in connection with the January fires in Los Angeles for 180 days.  The extension of the declaration of emergency allows insurers to utilize unlicensed adjusters under certain circumstances to facilitate the timely processing of claims.

RATING ISSUES

On June 18, 2025, the CDI issued Bulletin 2025-11 reminding all insurers that negotiated or mutually-agreed-upon rates, retroactive rating plans, LRAROs (Large Risk Alternative Rating Options), or consent-to-rate arrangements violate the prior approval provisions of Proposition 103. However, the Department may approve such arrangement if its specific rating factors or formulas satisfy the prior approval provisions. 

FAIR PLAN

On June 25, 2025, Commissioner Lara announced reforms to the California FAIR Plan, which will include the following:

1. Temporary expansion of FAIR plan coverage for high-value commercial properties, homeowners associations, and affordable housing developments, available July 26, 2025 to 2028.
2. The Department’s examination report of the FAIR Plan will be released in the coming weeks. 
3. Co-sponsored by Commissioner Lara, the pending bill AB 226 (FAIR Plan Stabilization Act) would authorize the FAIR Plan’s access to bonds, loans, and lines of credit, subject to the commissioner’s approval, to cover claims and maintain liquidity.  

Please see the press release for more information

This e-Bulletin was prepared by Nicole Zayac, Counsel in the San Francisco office of Willkie Farr & Gallagher LLP (nzayac@willkie.com). Ms. Zayac is a member of the Executive Committee of the California Lawyers Association Business Law Section and is the current Liaison to and past Chair of the Insurance Law Standing Committee

Chair
Sharon A. Huerta
Fennemore

Vice Chair – Publications
Tamiko A. Dunham
Nicolaides Fink Thorpe Michaelides Sullivan LLP

Vice Chair – Programs
Charles L. Crouch III

The Insurance Law Standing Committee’s monthly virtual meetings are open to its constituents and all interested members of the public. The next meeting is August 19, 2025. There is no obligation involved in meeting attendance. To request login information or if you have questions, please contact the Committee Chair, Sharon Huerta, shuerta@fennemorelaw.com.  

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