Bill > AB567

This bill, known as the Cap and Cut Cost of Insurance through Reform Act, proposes several significant changes to California's insurance market. The bill would require the state to cover any annual residential property insurance rate increases above either 7% or the national average increase, whichever is lower, upon appropriate funding. By March 31, 2026, the Department of Insurance must submit a comprehensive report to the Legislature detailing strategies to reduce insurance market regulations, achieve efficiency in insurance rates, allocate funds for fire fuel reduction, and explore ways to streamline regulations that impact property owners' ability to manage fire risks. The bill also temporarily reduces the gross premiums tax rate for residential property insurance policies to 0% from January 1, 2026, until January 1, 2030. Additionally, the legislation urges the Governor to engage with the federal government about creating a national reinsurance relief program that could help insurance companies manage reinsurance costs. These provisions aim to address rising insurance costs, particularly in fire-prone regions, by providing financial relief and promoting regulatory reforms in the insurance industry. The bill is set to expire on January 1, 2030, after which the current tax rates and regulations would be reinstated.

Budget and Finance, Business and Industry

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260AB567