Insurers would cover wildfire smoke testing and speed claim payments

Insurers would presume qualifying wildfire smoke caused the damage, pay required testing, keep additional living-expense coverage in place, and meet set inspection and payment deadlines. These rules cover covered smoke-damage claims for residential property in a ZIP Code within or partly within a wildfire fire perimeter. The living-expense rule remains subject to the policy limit and ends when the property is restored to its preloss condition and cleared for human occupancy. Testing must be needed for restoration and clearance and must follow state regulations or guidance, subject to the policy terms. Payment rules generally cover undisputed amounts and do not require an insurer to pay for upgrades beyond the property's prefire condition. A claim that is recontaminated after restoration and clearance is treated as a new claim with a new deductible. The rules apply to residential property insurance claims occurring on or after the section's operative date; payment deadlines run from inspection, restoration, total-loss determination, or receipt of a replacement-property receipt, as applicable.

The Department of Insurance would create and enforce smoke-damage training and certification programs for insurance adjusters and public insurance adjusters. The requirements cover adjusters who inspect, evaluate, sample, test, investigate, or adjust wildfire smoke damage involving residential property. Insurers, adjuster firms, and qualified managers would have to train and accredit their adjusters under the required rules. Public adjusters hired by insured people would need the required license, training, and certification. Violations would be unfair practices and could also lead to other disciplinary action. The Department of Insurance must develop both programs on or before July 1, 2029, and then implement and enforce them.

The Division of Occupational Safety and Health would propose safety regulations for employees working on residential properties damaged by wildfire smoke or fire. The proposed rules would cover employees performing repair, cleanup, or related work on smoke- or fire-damaged residential properties after a wildfire. The regulations must include certification requirements for people performing the work. The rules may charge certification fees, but fees could not exceed the cost of administering and enforcing the requirements. Fee money would go into a state certification and training fund and could be used only after legislative approval. The Division of Occupational Safety and Health must propose the regulations to the Occupational Safety and Health Standards Board on or before July 1, 2029; the board would then consider possible adoption.

The Department of Insurance and the Office of Emergency Services would study insurance gaps and emergency-response coordination related to the Lineage warehouse fire. The studies concern the June 17, 2026, Lineage Logistics fire in Boyle Heights, including insurance coverage, evacuation decisions, agency coordination, cleanup delays, and possible future safeguards. State and local agencies and other identified entities must provide requested information and assistance to the Office of Emergency Services and the California Environmental Protection Agency. The studies may recommend new laws, regulations, or insurance coverage triggers, but this section does not itself create those future changes. Each final report must be submitted to the Governor and Legislature and posted online. The Department of Insurance must complete its study by July 1, 2027, and report by December 1, 2027; the Office of Emergency Services must complete its study by December 31, 2027, and report by July 31, 2028.