Relief from California’s insurance affordability crisis

OPINION – Documents uncovered last fall reveal an unsettling truth. Seventy years ago, California’s biggest oil companies learned the use of their products is dangerous for our climate. Motivated by greed, industry leaders pioneered climate denial and spent decades burying the truth with lies to protect trillions of dollars in profits.

With climate science settled, Big Oil spreads a new lie to keep its profits rolling in – that climate action is an expensive luxury Californians can’t afford. That’s rich.

Big Oil has ruthlessly profited while exposing our homes, jobs, and lives to more frequent and destructive wildfires, extreme heat, drought, and floods. These are unnatural disasters, fueled by climate change caused primarily from burning fossil fuels. They are Big Oil’s legacy, and it’s time for Big Oil to pay its fair share when we pick up the pieces.

After January wildfires leveled more than 16,000 homes and businesses, Los Angeles faces a long road to rebuild. Although recovery costs are still being gathered, this is expected to be the most expensive disaster in US history. It must be a tipping point for change.

No question looms larger than who will pay to rebuild. While the hot, dry, and windy conditions fueling these wildfires were 35 percent more likely because of climate change, we’re on our own to figure it out with our insurers. The problem is Californians already face a significant strain threatening our access to affordable insurance.

In recent years, Californians have lost insurance options and faced higher insurance rates as insurers are bled dry from growing climate disaster costs. Los Angeles wildfires may accelerate this trend, with California’s largest private insurer receiving provisional approval for emergency rate hikes – 22% for homeowners, 15% for condo owners, and 38% for renters.

Many Californians have come to rely on the state’s insurer of last resort, the FAIR Plan, to have any insurance. Last month, for the first time in 3 decades, California approved shoring up the FAIR Plan to help pay claims in Los Angeles, which entails sending working people and insurers a $1 billion bill.

The Trump Administration and Congressional allies are magnifying the strain on California with outrageous and unprecedented political manipulation in placing conditions on disaster aid Angelenos desperately need. The President is turning his back on suffering Americans in the nation’s second largest city for a power play, which could mean California loses at least $40 billion in disaster aid – imposing bankruptcy onto families and businesses while dumping recovery costs onto all Californians.

This is an untenable situation requiring bold state action. By supporting Senate Bill 222, the Affordable Insurance and Climate Recovery Act, state lawmakers can enable Californians and insurers affected by climate disasters to sue for damages from the fossil fuel companies that lied about the climate risks of their products.

California Environmental Voters is proud to be a co-sponsor of this bill because it will provide long overdue justice to the industry causing our climate and affordability crisis, help keep a lid on our insurance rates, and preserve Californians’ access to affordable insurance options.

Accountability for Big Oil is urgently needed because climate disasters will be an expensive part of our future. A study by ClaimGuide.org ranked California the state most at risk with $16 billion in costs each year.

SB 222 will be a big fight and we look forward to it. In the lead up to bill hearings next month, Big Oil and its allies in the State Capitol will shamelessly spread lies to stop it. If they succeed, today’s climate crisis will only get worse, our financial burden from living through it will grow, and we will keep getting robbed at the pump.

That’s a blank check we can’t afford.

Mary Creasman is the CEO of California Environmental Voters.