TOPSHOT - A firefighter monitors the spread of the Auto Fire in Oxnard, North West of Los Angeles, California, on January 13, 2025. US officials warned "dangerous and strong" winds were set to push deadly wildfires further through Los Angeles residential areas January 12 as firefighters struggled to make progress against the flames. At least 24 people have been confirmed dead from blazes that have ripped through the city, reducing whole neighborhoods to ashes and leaving thousands without homes. (Photo by ETIENNE LAURENT / AFP) (Photo by ETIENNE LAURENT/AFP via Getty Images)
Sacramento, California – Six months after the deadly Palisades and Eaton firestorms tore through Los Angeles communities, California lawmakers are advancing a slate of bills aimed at rebuilding trust in the state’s fractured home insurance system and protecting high-risk homeowners from financial ruin.
At the center of this legislative effort is Assembly Bill 226, co-sponsored by Assemblymembers Lisa Calderon (D-Whittier) and David A. Alvarez (D-San Diego). The measure would make California’s FAIR Plan—the insurer of last resort for properties deemed too risky for private insurers—eligible for emergency loans and bonds from the state’s Infrastructure and Economic Development Bank. The goal is simple: prevent the FAIR Plan from running out of money in the wake of future disasters.
Had AB 226 been law last year, supporters argue, the FAIR Plan might have avoided imposing $1 billion in post-disaster assessments on private insurance companies—costs that are now trickling down to homeowners through rate increases. “Had they had this option available to them… they would not be having to hit consumers with price increases on the private market now,” Alvarez said.
The FAIR Plan, originally intended as a narrow backstop, has expanded rapidly as climate-fueled wildfires and rising costs have prompted traditional insurers to withdraw from high-risk zones. A Los Angeles Times analysis showed enrollment in the plan nearly doubled between 2020 and 2024 in the areas scorched by January’s fires. With lawsuits alleging coordination between private insurers and the FAIR Plan, and policyholders frustrated by delays and coverage denials, lawmakers say reforms are overdue.
The bill passed the Assembly in March and awaits consideration in the Senate. It’s one of several wildfire-related bills gaining traction in Sacramento. Other measures aim to protect disaster survivors from predatory insurance practices, streamline the claims process, and provide financial relief.
Lawmakers have already approved $2.5 billion in emergency wildfire aid, and leaders in both parties have called for urgency. “Tens of thousands of our neighbors, our families and friends, they need help,” said Senate President Pro Tem Mike McGuire (D-Healdsburg). “This means that we need to move with urgency… and deliver the policy relief that is needed to get neighborhoods cleaned up and communities rebuilt.”
AB 226 would give the FAIR Plan more financial flexibility without forcing insurers—and, by extension, homeowners—to shoulder the full burden of disaster costs. For communities still digging out from January’s fires, the bill offers a glimmer of future stability.
As fire seasons grow longer and more destructive, lawmakers are increasingly framing disaster legislation not as emergency response but as permanent infrastructure. “These state bills represent a commitment to meeting people where they are,” said Los Angeles County Supervisor Lindsey Horvath. “Wildfire survivors continue to face housing insecurity, financial strain, and emotional trauma long after the immediate danger has passed.”
The next test for AB 226 will be in the state Senate, where Alvarez hopes lawmakers act swiftly—“God forbid,” he said, “if it has to be used because of a devastating fire this summer.”
