California Insurance Commissioner Ricardo Lara has implemented a one-year moratorium on carriers non-renewing or cancelling residential property insurance policies resulting from the 2020 wildfires in areas within or adjacent to a fire perimeter after a declared state of emergency is issued by the Governor. On December 31, 2020, Commissioner Lara released the final ZIP codes protected from non-renewals for the 2020 wildfires. In total, 2.4 million policyholders and 563 ZIP codes are covered under the moratorium.

The moratorium was enacted “to address the long-term threats to Californians.” Commissioner Lara pledged to “continue to work with local communities and state leaders to ensure a healthy insurance market for everyone.”

Existing law prevents non-renewals and cancellations for those who suffer a total loss. The recently enacted law, Senate Bill 824 (Lara, Chapter 616, Statutes of 2018), known as the Wildfire Safety and Recovery Act, establishes protection for those living within or adjacent to a declared wildfire emergency who did not suffer a total loss. This new law is intended to address, for the first time, the disruption that non-renewals cause in communities following wildfire disasters. The protection lasts for one year from the date of the Governor’s emergency declaration and applies to all residential policyholders within the affected areas who suffer less than a total loss. Those residents who suffer a total loss have additional protections under the law.

The California Department of Insurance website contains Commissioner Lara’s Bulletin setting forth the ZIP codes impacted by the moratorium (https://www.insurance.ca.gov/01-consumers/140-catastrophes/MandatoryOneYearMoratoriumNonRenewals.cfm). If an insured’s ZIP code is included in the moratorium and he/she receives a notice of cancellation or non-renewal for wildfire risk, then they are encouraged by the California Department of Insurance to contact their carrier to seek a reinstatement of the policy and thereafter notify the Department if the carrier refuses.