Today's Law As Amended


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SB-897 Residential property insurance: wildfires.(2017-2018)



As Amends the Law Today


SECTION 1.

 Section 2060 of the Insurance Code is amended to read:

2060.
 (a) In the event of a loss under a homeowners’ insurance policy  loss, as described in Section 675, under a residential property insurance policy, as defined in Section 10087,  for which the insured has made a claim for additional living expenses, the insurer shall provide the insured with a list  list, in writing,  of items that the insurer believes may be covered under the policy as additional living expenses. The list may include a statement that the list is not intended to include all items covered under the policy, but only those that are commonly claimed, if this is the case. If the department develops a list for use by insurers, the insurer may use that list.
(b) (1) In the event of a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, coverage for additional living expenses shall be for a period of no less than 24 months from the inception of the loss, but shall be subject to other policy provisions. An insurer shall grant an extension of up to 12 additional months, for a total of 36 months, if an insured acting in good faith and with reasonable diligence encounters a delay or delays in the reconstruction process that are the result of circumstances beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, lack of necessary construction materials, and lack of available contractors to perform the necessary work. Additional extensions of six months shall be provided to policyholders for good cause.
(2) (b)  A policy that provides coverage for additional living expenses subject to this subdivision shall not limit the policyholder’s right to recovery if the insured home is rendered uninhabitable by a covered peril. However, an insurer may, in lieu of making living expense payments required by this subdivision, provide a reasonable alternative remedy that addresses the property condition that precludes reasonable habitation of the insured premises. The additional living expense coverage subject to this section does not include a utility public safety power shut off event, which is the deenergization of a portion of the electrical distribution or transmission system to reduce the risk of wildfire ignition. Additional living expense coverage under a residential property insurance policy shall include reimbursement for all reasonable additional expenses incurred by the insured in order to maintain a comparable standard of living following a covered loss. These additional costs shall include, but not be limited to, housing, furniture rental, food, transportation, storage, and boarding of pets. 
(c) For a loss that is otherwise not subject to paragraph (1) or (2) of subdivision (b), in the event of a state of emergency, as defined in Section 8558 of the Government Code, that is accompanied by an order of civil authority restricting access to the home, related to a covered peril, additional living expense coverage shall be provided for at least two weeks. Additional extensions of two weeks shall be provided to a policyholder for good cause, but shall be subject to other policy provisions.
(d) The amendments made by the act that added this subdivision shall be operative on July 1, 2021.

SEC. 2.

 Section 2061 is added to the Insurance Code, to read:

2061.
 In the event of a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, the following special provisions shall apply:
(a) If an insured has made a claim for living expenses related to a total loss, an insurer shall, upon request by an insured, render an advance payment of no less than four months of living expenses. Additional payment for additional living expenses shall be payable upon proper proof following the advance period.
(b) If an insured has made a claim for contents related to a total loss of a primary residence, an insurer shall render an initial advance payment of no less than 25 percent of the policy limit for contents without the completion of an inventory. Additional payment for contents shall be payable upon request with proper proof.
(c) If an insured has made a claim for contents related to a total loss of a primary residence, an insurer shall not require that the insured use a company-specific inventory form if the insured can provide an inventory using a form that contains substantially the same information. Nothing in this subdivision limits the authority of an insurer to seek additional information from an insured upon receipt of an inventory form submitted by an insured.
(d) If an insured has made a claim for contents related to a total loss of a primary residence, an insurer shall accept an inventory that includes groupings of categories of personal property, including, but not limited to, clothing, shoes, books, food items, CDs, DVDs, or other categories of items for which it would be impractical to separately list each individual item claimed.
(e) If an insured has made a claim for contents related to a total loss of a primary residence, the insurer shall offer no less than 80 percent of the policy limit for contents without requiring the insured to file an itemized claim. The insurer shall notify the insured that the insured retains the option to recover additional benefits if the insured subsequently completes a full inventory.

SEC. 3.

 Section 2062 is added to the Insurance Code, to read:

2062.
 In the event of a state of emergency, as defined in Section 8558 of the Government Code, an insurer shall grant a 30-day grace period for payment of premiums for residential property insurance policies covering a property located within the affected area defined in the state of emergency for a period of 30 days after the emergency. This section does not require any change to insurer billing practices regarding billing, automatic payment, or cancellation for nonpayment if the insurer reinstates, without a lapse in coverage or late fees, any policy subject to this section that was canceled for nonpayment of premiums, if requested by the insured and upon reasonably timely payment of all premiums due.
SEC. 4.
 The provisions of this bill are severable. If any provision of this bill or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
SEC. 5.
 Subdivisions (c), (d), and (e) of Section 2061 of the Insurance Code as added by Section 2 of this act shall be applied retroactively to any claim for contents related to a loss incurred on or after July 1, 2017, and which has not been submitted as of January 1, 2019.