Commissioner Lara’s new regulation, California Code of Regulations Section 2644.9. Consideration of Mitigation Factors; Wildfire Risk Models, effective Oct. 14, 2022, required those insurers that differentiate property insurance rates based on wildfire risks to submit applications for new or modified rating plans to the department that recognize and reward safety and mitigation efforts.

The applications were due no later than April 12, 2023 (180 days after the effective date of the regulation).

Regulation 2644.9 lists mandatory factors, requiring insurers to take both community-level mitigation designations and property-level mitigation efforts into account in their rating plans.

• Community level-designations are Fire Risk Reduction Community (from the Board of Forestry) and Firewise USA Site (“In Good Standing” status).

• Protection-level mitigation efforts include measures addressing the immediate surroundings of a property and building hardening measures.

• Immediate surroundings protections include clearing vegetation, debris, mulch, stored combustible materials, moveable combustible objects located within five feet of the property; removal of combustible sheds and outbuildings from the immediate surroundings of the property to at least 30 feet; defensible space compliance, including trimming trees, removal of brush and debris from yard; and compliance with state law and local ordinances.

• Building structure protections include Class-A Fire rated roof; enclosed eaves; ember and fire-resistant vents; multi-pane windows; at least six inchers of noncombustible vertical clearance at the bottom of the exterior building surface.

• Optionally, the regulation also allowed insurers to consider other wildfire risk mitigation measures (fuel, slope, access, aspect, structural characteristics, wind).

The regulation also sets forth timeframes in which insurers are required to notify renewing policyholders and applicants for insurance—in writing—of wildfire risk scores or classifications used to create rate differentials or surcharges to their premiums.

The FAIR Plan in late July announced it will reward homeowners for mitigation efforts through Safer From Wildfire discounts, effective Aug. 23.

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