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SB 876: Fire and residential property insurance.

California · Senate · 2025–2026 Regular Session · last verified September 29, 2026

What SB 876 does, verified September 29, 2026

<em>This bill amends several sections of California's insurance code to address fire and residential property insurance. It requires insurers to pay actual cash value within 30 days for total losses and undisputed replacement costs thereafter. For building code upgrades in case of a total loss, it mandates coverage at least 20% of policy limits if related to an emergency. The bill also ensures that new policies offer extended replacement cost coverage of at least 50%. It deletes exemptions for insurers providing cost estimates and extends these requirements to the California Fair Plan Association. Additionally, it modifies additional living expense coverage terms and increases policy limits during emergencies. Insurers must now assign a primary claims adjuster for emergency-related losses and provide status reports within five business days if subsequent adjusters are assigned. The bill…

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Last action: Chaptered by Secretary of State. Chapter 656, Statutes of 2026. (2026-09-27)Alert me

Author and sponsors

Sen. Stephen PadillaAuthor · California State Senate

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Coauthors

Dawn Addis

Recent actions34 total · showing 5

Sep. 27, 2026	Chaptered by Secretary of State. Chapter 656, Statutes of 2026.
Sep. 27, 2026	Approved by the Governor.
Sep. 09, 2026	Enrolled and presented to the Governor at 2 p.m.
Aug. 31, 2026	Assembly amendments concurred in. (Ayes 26. Noes 9.) Ordered to engrossing and enrolling.
Aug. 31, 2026	In Senate. Concurrence in Assembly amendments pending.

Full action history, 29 earlier actionsConnect Plus

Latest bill textChaptered version, September 27, 2026 · 24,634 words

Senate Bill No. 876

CHAPTER 656

An act to amend Section 2071 of, to amend, repeal, and add Sections 790.035, 929, 2051.5, 2060, 10102, 10103, 10103.2, 10103.4, 12928.7, and 14047 of, and to add Section 10103.8 to, the Insurance Code, relating to insurance.

[ Approved by Governor September 27, 2026. Filed with Secretary of State September 27, 2026. ]

LEGISLATIVE COUNSEL'S DIGEST

SB 876, Padilla. Fire and residential property insurance.

(1) Existing law generally regulates classes of insurance, including fire and residential property insurance.

Existing law prohibits a policy from limiting or denying a payment of building code upgrade cost on the basis that the insured has decided to rebuild at a new location or to purchase an already built home at a new location.

If there is a total loss of the insured structure, this bill would require the building code upgrade cost payable to include all costs that would have been incurred if the insured structure been completely rebuilt at its original location.

(2) Existing law requires a disclosure to be provided upon an offer of a residential property insurance policy that states policies offering extended replacement cost coverage of at least 50% may be available for that property and that includes the internet website address of the Homeowners Coverage Comparison Tool. Existing law exempts specified insurers, agents, and brokers from this requirement.

This bill would instead prohibit a residential property insurance policy from being issued or renewed unless the applicant or insured is offered extended replacement cost coverage in an amount of no less than 50% of coverage above the policy limits for the primary dwelling if the property is eligible for replacement cost coverage. If an applicant or policyholder declines this offer, the bill would require the insurer to record acknowledgment of the declination, as specified.

(3) Existing law requires an insurer that provides replacement cost coverage to provide a cost estimate for rebuilding or replacing the structure at specified intervals, but exempts an insurer that meets specified criteria from this requirement.

This bill would delete those exemptions and would extend the cost estimate requirements to a policy provided by the California FAIR Plan Association if replacement cost coverage is available under the policy and the policy limit being offered or provided is less than the maximum combined policy limit available under this program.

(4) Existing law requires an insurer to provide an insured with a list of items that the insurer believes may be covered under the policy as additional living expenses if there is a loss under a homeowners’ insurance policy for which the insured has made a claim for additional living expenses. If there is a covered loss relating to a state of emergency, existing law requires additional living expense coverage to be for a period of no less than 24 months from the inception of the loss.

This bill would require the above-described list to be written, and would authorize the list to be transmitted as an electronic document. The bill would require additional living expense coverage to include all reasonable additional expenses incurred by the insured for the insured to maintain a comparable standard of living for the time the insured dwelling is not habitable due to a covered loss, as specified. The bill would authorize an insurer to offer the ability to the insured to choose to collect the monthly fair rental value of the dwelling in lieu of reimbursement for itemized expenses under additional living expense coverage, as specified. If there is a covered total loss relating to a state of emergency, the bill would require loss of use, fair rental value, or similar coverage to be for a period of no less than 24 months from the inception of the loss and would extend additional living expenses 15 calendar days beyond the date upon which the premises is deemed habitable. The bill would prohibit issuing or renewing a homeowners’ insurance policy that contains a dollar policy limit for additional living expense coverage without offering extended additional living expense, loss of use, or fair rental value, or similar coverage in an amount of no less than 50% of coverage above the underlying policy limits for additional living expenses.

(5) Existing law requires a residential property insurer to provide a written status report to the insured if the insurer assigns a 3rd or subsequent first-party claims adjuster within a 6-month period for a claim arising as a result of a state of emergency. Existing law prescribes the standard form for fire insurance policies covering property and requires the form to include specified statements regarding this status report. Under existing law, it is a misdemeanor to issue or countersign a fire policy that varies from the standard form fire insurance policy.

This bill would require an insurer to assign a primary point of contact within 30 calendar days from the date the notice of claim is provided to the insurer to be primarily responsible for a claim that involves one or more coverages under a policy of residential property insurance and is for a loss relating to a state of emergency, and would require an insurer to provide a written report within 15 calendar days of the assignment of a subsequent point of contact. The bill would make conforming changes to the standard form for fire insurance, thus expanding the scope of an existing crime and imposing a state-mandated local program.

(6) Existing law prescribes the standard form of the California Residential Insurance Disclosure, which sets forth a description of certain types of insurance coverage. Existing law requires a residential property insurance policy to include specified information about coverage on its declarations page. Existing law requires the disclosure and declarations page to explain that building code upgrade coverage covers additional costs to comply with building codes and zoning laws in effect at the time of loss or rebuilding.

This bill would instead require the above-described disclosure and declarations page to explain that building code upgrade coverage covers additional costs to comply with building codes and zoning laws in effect at the time of rebuilding and required for rebuilding.

(7) Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and prescribes the commissioner’s powers and duties. Existing law requires an admitted insurer to submit various reports and documents to the commissioner or department upon request or at specified intervals and authorizes the commissioner to conduct an examination of an insurer at the commissioner’s discretion.

This bill would require a residential property insurer to submit a detailed disaster response plan to the department before April 1, 2028, and would require the plan to be updated every 2 years or upon the commissioner’s request. The bill would also require a residential property insurer to report to the commissioner the losses, claims, and estimate of total incurred losses no later than 30 calendar days from the date a state of emergency was declared if there is a related covered loss. The bill would make information submitted pursuant to these provisions confidential.

(8) Existing law defines certain actions as unfair methods of competition and unfair and deceptive acts or practices in the business of insurance. Under existing law, a person who engages in an unfair method of competition or an unfair or deceptive act or practice is liable to the state for a civil penalty to be fixed by the commissioner, not to exceed $5,000 for each act, or, if the act or practice was willful, a civil penalty not to exceed $10,000 for each act. Existing law authorizes the commissioner to order a respondent to provide restitution for a loss arising from the respondent’s conduct, but exempts specified surplus line brokers, production agencies, and administrators from those restitution orders.

This bill would additionally make a person who engages in an unfair method of competition or an unfair or deceptive act or practice relating to a state of emergency liable to the state for a civil penalty to be fixed by the commissioner, not to exceed $10,000 for each act, or, if the act or practice was willful, a civil penalty not to exceed $20,000 for each act. The bill would authorize the commissioner to order a person who engages in an unfair claims settlement practice to provide restitution, as specified. The bill would eliminate the restitution order exemption for surplus line brokers, production agencies, and administrators.

(9) Existing law requires an admitted insurer with written California premiums totaling $10,000,000 or more to submit a report with specified fire risk information on its residential property policies to the commissioner on or before April 1, 2020, and every 2 years thereafter.

This bill would instead require an admitted insurer with written California premiums totaling $20,000,000 or more to submit a report on or before April 1, 2028, and every 2 years thereafter, on its residential property experience data for the previous 3 years for policies written in California, reported by individual policy.

(10) This bill would make its provisions operative on January 1, 2028.

(11) Existing constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.

This bill would make legislative findings to that effect.

(12) This bill would incorporate additional changes to Section 2051.5 of the Insurance Code proposed by SB 878 to be operative only if this bill and SB 878 are enacted and this bill is enacted last.

The bill would incorporate additional changes to Section 2071 of the Insurance Code proposed by SB 877 to be operatively only if this bill and SB 877 are enacted and this bill is enacted last.

The bill would incorporate additional changes to Section 12928.7 of the Insurance Code proposed by SB 1206 to be operative only if this bill and SB 1206 are enacted and this bill is enacted last.

(13) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES

The people of the State of California do enact as follows:

SECTION 1.

Section 790.035 of the Insurance Code is amended to read:

790.035.

(a) Any person who engages in any unfair method of competition or any unfair or deceptive act or practice defined in Section 790.03 is liable to the state for a civil penalty to be fixed by the commissioner, not to exceed five thousand dollars ($5,000) for each act, or, if the act or practice was willful, a civil penalty not to exceed ten thousand dollars ($10,000) for each act. The commissioner shall have the discretion to establish what constitutes an act. However, when the issuance, amendment, or servicing of a policy or endorsement is inadvertent, all of those acts shall be a single act for the purpose of this section.

(b) The penalty imposed by this section shall be imposed by and determined by the commissioner as provided by Section 790.05. The penalty imposed by this section is appealable by means of any remedy provided by Section 12940 or by Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.

SEC. 2.

Section 790.035 is added to the Insurance Code, to read:

790.035.

(a) A person who engages in an unfair method of competition or an unfair or deceptive act or practice defined in Section 790.03 is liable to the state for a civil penalty to be fixed by the commissioner, not to exceed five thousand dollars ($5,000) for each act, or, if the act or practice was willful, a civil penalty not to exceed ten thousand dollars ($10,000) for each act.

(b) A person who engages in an unfair method of competition or an unfair or deceptive act or practice defined in Section 790.03 relating to a state of emergency, as defined in Section 8558 of the Government Code, is liable to the state for a civil penalty, to be fixed by the commissioner, of no less than five thousand dollars ($5,000) for each act, not to exceed ten thousand dollars ($10,000) for each act, or, if the act or practice was willful, a civil penalty of no less than ten thousand dollars ($10,000) for each act, not to exceed twenty thousand dollars ($20,000) for each act.

(c) The commissioner shall have the discretion to establish what constitutes an act. However, when the issuance, amendment, or servicing of a policy or endorsement is inadvertent, all of those acts shall be a single act for the purpose of this section.

(d) The penalty imposed pursuant to this section shall be imposed by and determined by the commissioner as provided by Section 790.05. The penalty imposed by this section is appealable by means of a remedy provided by Section 12940 or by Chapter 5 (commencing with Section 11500) of Part 1 of Division 3 of Title 2 of the Government Code.

(e) In addition to a penalty imposed pursuant to this section, the commissioner may order a person who engages in an unfair claims settlement practice defined in Section 790.03 to provide restitution for a loss arising from the person’s conduct, pursuant to Section 12928.7.

(1) Restitution ordered pursuant to this subdivision shall be limited to an identifiable individual claimant, shall be based on evidence of actual harm suffered by that individual, shall be limited to direct financial loss proximately caused by the respondent’s violation, and shall not include consequential, speculative, or noneconomic damages.

(2) Restitution may be ordered only after notice and opportunity for hearing conducted in accordance with the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(f) This section does not create a private right of action or serve as a basis for liability under Section 17200 of the Business and Professions Code.

(g) This section shall become operative on January 1, 2028.

SEC. 3.

Section 929 of the Insurance Code is amended to read:

929.

(a) (1) On or before April 1, 2020, and every two years thereafter, an admitted insurer with written California premiums totaling ten million dollars ($10,000,000) or more shall submit a report to the commissioner on its residential property experience data for the previous two years for policies written in California.

(2) The premium threshold for reporting shall be increased to twelve million dollars ($12,000,000) for the reports due on April 1, 2026, and shall thereafter be increased every five years by 20 percent of the threshold amount required in the year immediately preceding the increase.

(3) Reports filed on April 1, 2020, shall include data from calendar years 2018 and 2019. Subsequent reports shall likewise include data from the two calendar years immediately preceding the year in which the report is due.

(b) The commissioner may specify, by bulletin, the manner of submission and format of the report required pursuant to subdivision (a). The report shall include the following information reported by individual policy:

(1) Fire- or wildfire-incurred losses, if any, reported by property coverage category and the date of the loss.

(2) The public protection class or its equivalent, if utilized by the insurer.

(3) The specific numerical or other fire risk score and source of fire risk score, if applicable.

(4) Premium.

(5) ZIP Code.

(c) If the commissioner issues a bulletin pursuant to subdivision (b), the initial bulletin shall be posted to the department’s internet website on or before May 1, 2019. Any updated bulletin shall be posted no less than two months before the date that the insurer’s report in which the changes are required is due.

(d) An insurance holding company system, as defined in subdivision (e) of Section 1215, may submit a consolidated report of the information required by this section for all insurers comprising the holding company system.

(e) For the purposes of this section, “policy of residential property insurance” has the meaning described in subdivision (a) of Section 10087.

(f) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 4.

Section 929 is added to the Insurance Code, to read:

929.

(a) On or before April 1, 2028, and every two years thereafter, an admitted insurer with written California premiums totaling twenty million dollars ($20,000,000) or more shall submit a report to the commissioner on its residential property experience data for the previous three years for policies written in California, reported by individual policy.

(1) Fire- or wildfire-incurred losses, if any, reported by property coverage category and the date of the loss.

(2) Building characteristics.

(3) The specific numerical or other fire risk score and source of fire risk score, if applicable.

(4) Premium.

(5) Exposure.

(6) Address.

(d) An insurance holding company system, as defined in subdivision (h) of Section 1215, may submit a consolidated report of the information required by this section for all insurers comprising the holding company system.

(e) For the purposes of this section, “policy of residential property insurance” has the meaning described in subdivision (a) of Section 10087.

(f) This section shall become operative on January 1, 2028.

SEC. 5.

Section 2051.5 of the Insurance Code is amended to read:

2051.5.

(a) (1) Under an open policy that requires payment of the replacement cost for a loss, the measure of indemnity is the amount that it would cost the insured to repair, rebuild, or replace the thing lost or injured, without a deduction for physical depreciation, or the policy limit, whichever is less.

(2) If the policy requires the insured to repair, rebuild, or replace the damaged property in order to collect the full replacement cost, the insurer shall pay the actual cash value of the damaged property, as defined in Section 2051, until the damaged property is repaired, rebuilt, or replaced. Once the property is repaired, rebuilt, or replaced, the insurer shall pay the difference between the actual cash value payment made and the full replacement cost reasonably paid to replace the damaged property, up to the limits stated in the policy.

(b) (1) (A) A time limit of less than 12 months from the date that the first payment toward the actual cash value is made shall not be placed upon an insured in order to collect the full replacement cost of the loss, subject to the policy limit.

(B) In the event of a loss relating to a “state of emergency,” as defined in Section 8558 of the Government Code, a time limit of less than 36 months from the date that the first payment toward the actual cash value is made shall not be placed upon the insured in order to collect the full replacement cost of the loss, subject to the policy limit.

(C) This section does not prohibit an insurer from allowing the insured additional time to collect the full replacement cost.

(2) An insurer shall provide to a policyholder one or more additional extensions of six months for good cause pursuant to subparagraph (A) or (B) of paragraph (1) if the insured, acting in good faith and with reasonable diligence, encounters a delay or delays in approval for, or reconstruction of, the home or residence that are beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, the lack of necessary construction materials, or the unavailability of contractors to perform the necessary work.

(3) (A) In the event of a loss relating to a state of emergency, as defined in Section 8558 of the Government Code, an insurer shall not require the insured to provide proof of loss less than 100 days after the loss.

(B) The insurer shall provide to the insured one or more additional extensions of three months for submission of proof of loss for good cause if the insured, acting in good faith and with reasonable diligence, encounters a delay in providing proof of loss that is beyond the control of the insured. Circumstances beyond the control of the insured may include, but are not limited to, any of the following, where applicable to the specific claim:

(i) Delays by the insurer in acknowledging the claim or providing the claimant necessary forms, instructions, and reasonable assistance, including, but not limited to, specifying the information the claimant must provide for proof of loss.

(ii) For personal property coverage, the fact that a personal property inventory is premature if the primary structure has not yet commenced construction.

(iii) The unavailability of contractors to either perform the necessary work or create an estimate to rebuild, repair, or replace.

(iv) The disability, injury, or incapacity of the insured.

(v) The inability of the insured to access the insured property as a result of governmental action or because the insured property is located in an area that is exposed to hazardous materials posing a health risk.

(c) (1) In the event of a total loss of the insured structure, a policy issued or delivered in this state shall not contain a provision that limits or denies, on the basis that the insured has decided to rebuild at a new location or to purchase an already built home at a new location, payment of the building code upgrade cost or the replacement cost, including any extended replacement cost coverage, to the extent those costs are otherwise covered by the terms of the policy or any policy endorsement. However, the measure of indemnity shall not exceed the replacement cost, including the building code upgrade cost and any extended replacement cost coverage, if applicable, to repair, rebuild, or replace the insured structure at its original location.

(2) Notwithstanding any other law, for a residential property insurance policy, the measure of damages available to a policyholder to use to rebuild or replace the insured home at another location shall be the amount that would have been recoverable had the insured dwelling been rebuilt at its original location, and a deduction for the value of land at the new location shall not be permitted from that measure of damages. However, the measure of indemnity shall not exceed the cost, including the building code upgrade cost and any extended replacement cost coverage, if applicable, to rebuild the insured structure at its original location.

(d) This section does not prohibit an insurer from restricting payment in cases of suspected fraud.

(e) On and after July 1, 2026, all policy forms issued or renewed by an insurer shall comply with this section in its entirety, including the changes made to this section by the act that added this paragraph.

(f) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 5.5.

Section 2051.5 of the Insurance Code is amended to read:

2051.5.

(3) After a payment is made pursuant to paragraph (2) of subdivision (b) of Section 2051, and after the insurer has received adequate proof of loss and documentation reasonably sufficient to determine the amount payable, an insurer shall pay the undisputed amount of replacement cost associated with the primary structure and other insured structures, up to the limits in the policy, within 30 calendar days from the occurrence of either of the following:

(A) The date upon which the insured obtains a valid and executed contract with a licensed contractor to rebuild the insured structure at its original location or at another location.

(B) The date upon which the insured enters into contract or escrow to purchase a replacement home at another location pursuant to subdivision (c).

(4) A payment that is not made pursuant to this section within 30 calendar days shall accrue interest payable to the insured pursuant to Section 2057.

(C) This section does not prohibit an insurer from allowing the insured additional time to collect the full replacement cost.

(ii) For personal property coverage, the fact that a personal property inventory is premature if the primary structure has not yet commenced construction.

(iii) The unavailability of contractors to either perform the necessary work or create an estimate to rebuild, repair, or replace.

(iv) The disability, injury, or incapacity of the insured.

(d) This section does not prohibit an insurer from restricting payment in cases of suspected fraud.

(f) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 6.

Section 2051.5 is added to the Insurance Code, to read:

2051.5.

(B) If a loss is relating to a state of emergency, as defined in Section 8558 of the Government Code, a time limit of less than 36 months from the date that the first payment toward the actual cash value is made shall not be placed upon the insured in order to collect the full replacement cost of the loss, subject to the policy limit.

(C) This section does not prohibit an insurer from allowing the insured additional time to collect the full replacement cost.

(3) (A) If a loss is relating to a state of emergency, as defined in Section 8558 of the Government Code, an insurer shall not require the insured to provide proof of loss less than 100 days after the loss.

(ii) For personal property coverage, the fact that a personal property inventory is premature if the primary structure has not yet commenced construction.

(iii) The unavailability of contractors to either perform the necessary work or create an estimate to rebuild, repair, or replace.

(iv) The disability, injury, or incapacity of the insured.

(c) (1) If there is a total loss of the insured structure, a policy issued or delivered in this state shall not contain a provision that limits or denies, on the basis that the insured has decided to rebuild at a new location or to purchase an already built home at a new location, payment of the building code upgrade cost or full replacement cost, including any extended replacement cost coverage, to the extent those costs are otherwise covered by the terms of the policy or any policy endorsement. However, the measure of indemnity shall not exceed the replacement cost, including the building code upgrade cost and any extended replacement cost coverage, if applicable, to repair, rebuild, or replace the insured structure at its original location, up to the limits stated in the policy. Notwithstanding a provision in a policy issued, amended, or renewed on or after January 1, 2028, for purposes of this paragraph, if the insured has decided to rebuild at a new location or to purchase an already built home at a new location, the building code upgrade cost payable shall include all costs that would have been incurred if the insured structure been completely rebuilt at its original location.

(d) This section does not prohibit an insurer from restricting payment in cases of suspected fraud.

(e) This section shall become operative on January 1, 2028.

SEC. 6.5.

Section 2051.5 is added to the Insurance Code, to read:

2051.5.

(A) The date upon which the insured obtains a valid and executed contract with a licensed contractor to rebuild the insured structure at its original location or at another location.

(B) The date upon which the insured enters into contract or escrow to purchase a replacement home at another location pursuant to subdivision (c).

(4) A payment that is not made pursuant to this section within 30 calendar days shall accrue interest payable to the insured pursuant to Section 2057.

(C) This section does not prohibit an insurer from allowing the insured additional time to collect the full replacement cost.

(ii) For personal property coverage, the fact that a personal property inventory is premature if the primary structure has not yet commenced construction.

(iii) The unavailability of contractors to either perform the necessary work or create an estimate to rebuild, repair, or replace.

(iv) The disability, injury, or incapacity of the insured.

(d) This section does not prohibit an insurer from restricting payment in cases of suspected fraud.

(e) This section shall become operative on January 1, 2028.

SEC. 7.

Section 2060 of the Insurance Code is amended to read:

2060.

(a) In the event of a loss under a homeowners’ insurance policy for which the insured has made a claim for additional living expenses, the insurer shall provide the insured with a list of items that the insurer believes may be covered under the policy as additional living expenses. The list may include a statement that the list is not intended to include all items covered under the policy, but only those that are commonly claimed, if this is the case. If the department develops a list for use by insurers, the insurer may use that list.

(b) (1) In the event of a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, coverage for additional living expenses shall be for a period of no less than 24 months from the inception of the loss, but shall be subject to other policy provisions. An insurer shall grant an extension of up to 12 additional months, for a total of 36 months, if an insured acting in good faith and with reasonable diligence encounters a delay or delays in the reconstruction process that are the result of circumstances beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, lack of necessary construction materials, and lack of available contractors to perform the necessary work. Additional extensions of six months shall be provided to policyholders for good cause.

(2) A policy that provides coverage for additional living expenses subject to this subdivision shall not limit the policyholder’s right to recovery if the insured home is rendered uninhabitable by a covered peril. However, an insurer may, in lieu of making living expense payments required by this subdivision, provide a reasonable alternative remedy that addresses the property condition that precludes reasonable habitation of the insured premises. The additional living expense coverage subject to this section does not include a utility public safety power shutoff event, which is the deenergization of a portion of the electrical distribution or transmission system to reduce the risk of wildfire ignition.

(c) For a loss that is otherwise not subject to paragraph (1) or (2) of subdivision (b), in the event of a state of emergency, as defined in Section 8558 of the Government Code, that is accompanied by an order of civil authority restricting access to the home, related to a covered peril, additional living expense coverage shall be provided for at least two weeks. Additional extensions of two weeks shall be provided to a policyholder for good cause, but shall be subject to other policy provisions.

(d) The amendments made by the act that added this subdivision shall be operative on July 1, 2021.

(e) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 8.

Section 2060 is added to the Insurance Code, to read:

2060.

(a) (1) If there is a loss under a homeowners’ insurance policy for which the insured has made a claim for additional living expenses, the insurer shall provide the insured with a written list of items that the insurer believes may be covered under the policy as additional living expenses. The list may include a statement that the list is not intended to include all items covered under the policy, but only those that are commonly claimed, if this is the case. If the department develops a list for use by insurers, the insurer may use that list. The list provided by the insurer may be transmitted as an electronic document pursuant to Section 38.6.

(2) Additional living expense coverage under a homeowners’ insurance policy shall include reimbursement for all reasonable additional expenses incurred by the insured, over and above the expenses incurred before the loss, for the insured to maintain a comparable standard of living for the time the insured dwelling is not habitable due to a covered loss, up to the limits in the policy, if any. These additional costs shall include temporary housing, furniture rental, food, transportation, storage, and boarding of pets.

(3) Under a homeowners’ insurance policy for which the insured has made a claim for additional living expenses, the insurer may offer to the insured, in lieu of providing reimbursement for itemized expenses, the ability for the insured to choose to collect the monthly fair rental value of the dwelling for the time the insured dwelling is not habitable due to the covered loss, up to the limits of the policy, if any. For purposes of this paragraph, if the underlying policy provides coverage for loss to personal property, the fair rental value is the amount the insured dwelling could have demanded for rental in furnished condition at the time of the loss. If the underlying policy does not provide coverage for loss to personal property, fair rental value is the amount the insured dwelling could have demanded for rental in unfurnished condition at the time of the loss.

(b) (1) If there is a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, coverage for additional living expenses, loss of use, or fair rental value, or similar coverage shall be for a period of no less than 24 months from the inception of the loss, but shall be subject to other policy provisions. An insurer shall grant an extension of up to 12 additional months, for a total of 36 months, if an insured acting in good faith and with reasonable diligence encounters a delay or delays in the reconstruction process that are the result of circumstances beyond the control of the insured. Circumstances beyond the control of the insured include, but are not limited to, unavoidable construction permit delays, lack of necessary construction materials, and lack of available contractors to perform the necessary work. Additional extensions of six months shall be provided to policyholders for good cause.

(2) A policy that provides coverage for additional living expenses, loss of use, or fair rental value, or similar coverage subject to this subdivision shall not limit the policyholder’s right to recovery if the insured home is rendered uninhabitable by a covered peril. However, an insurer may, in lieu of making the payments required by this subdivision, provide a reasonable alternative remedy that addresses the property condition that precludes reasonable habitation of the insured premises. The coverage subject to this section does not include a utility public safety power shutoff event, which is the deenergization of a portion of the electrical distribution or transmission system to reduce the risk of wildfire ignition.

(3) Additional living expenses, loss of use, or fair rental value, or similar coverage provided pursuant to this subdivision shall be for the period of time that the insured premises is deemed uninhabitable and shall extend 15 calendar days beyond the date upon which the premises is deemed habitable for the insured to make the necessary arrangements to move back into the premises.

(c) For a loss that is otherwise not subject to subdivision (b), if there is a state of emergency, as defined in Section 8558 of the Government Code, that is accompanied by an order of civil authority restricting access to the home, related to a covered peril, additional living expense, loss of use, fair rental value, or similar coverage shall be provided for at least two weeks. Additional extensions of two weeks shall be provided to a policyholder for good cause, but shall be subject to other policy provisions.

(d) A homeowners’ insurance policy that contains a dollar policy limit for additional living expense coverage shall not be issued or renewed in this state unless the applicant or insured is offered extended additional living expense, loss of use, fair rental value, or similar coverage in an amount of no less than 50 percent of coverage above the underlying policy limits for additional living expenses. The offer shall be accompanied by the premium charge for this additional coverage.

(e) This section applies only to an insured’s primary dwelling that is rendered uninhabitable due to a covered peril and is insured under a residential property insurance policy that provides coverage for additional living expenses, loss of use, fair rental value, or similar benefits described in this section.

(f) This section shall become operative on January 1, 2028.

SEC. 9.

Section 2071 of the Insurance Code is amended to read:

2071.

(a) The following is adopted as the standard form of fire insurance policy for this state:

California Standard Form Fire Insurance Policy

No.

[Space for insertion of name of company or companies issuing the policy and other matter permitted to be stated at the head of the policy.]

[Space for listing amounts of insurance, rates and premiums for the basic coverages insured under the standard form of policy and for additional coverages or perils insured under endorsements attached.]

In consideration of the provisions and stipulations herein or added hereto and of ____ dollars premium this company, for the term of ________

from the ________ day of _______ , 20 _______	⎫	At 12:01 a.m.,
to the __________ day of ________ , 20 ______	⎭	standard time,

at location of property involved, to an amount not exceeding ____ dollars, does insure ________ and legal representatives, to the extent of the actual cash value of the property at the time of loss, but not exceeding the amount which it would cost to repair or replace the property with material of like kind and quality within a reasonable time after the loss, without allowance for any increased cost of repair or reconstruction by reason of any ordinance or law regulating construction or repair, and without compensation for loss resulting from interruption of business or manufacture, nor in any event for more than the interest of the insured, against all LOSS BY FIRE, LIGHTNING AND BY REMOVAL FROM PREMISES ENDANGERED BY THE PERILS INSURED AGAINST IN THIS POLICY, EXCEPT AS HEREINAFTER PROVIDED, to the property described hereinafter while located or contained as described in this policy, or pro rata for five days at each proper place to which any of the property shall necessarily be removed for preservation from the perils insured against in this policy, but not elsewhere.

Assignment of this policy shall not be valid except with the written consent of this company.

This policy is made and accepted subject to the foregoing provisions and stipulations and those hereinafter stated, which are hereby made a part of this policy, together with any other provisions, stipulations and agreements as may be added hereto, as provided in this policy.

IN WITNESS WHEREOF, this company has executed and attested these presents; but this policy shall not be valid unless countersigned by the duly authorized agent of this company at

_____ _____ Secretary.	_____ _____ President.
Countersigned this	day of , 20
_____ Agent

Concealment, fraud

This entire policy shall be void if, whether before or after a loss, the insured has willfully concealed or misrepresented any material fact or circumstance concerning this insurance or the subject thereof, or the interest of the insured therein, or in case of any fraud or false swearing by the insured relating thereto.

Uninsurable and excepted property

This policy shall not cover accounts, bills, currency, deeds, evidences of debt, money or securities; nor, unless specifically named hereon in writing, bullion or manuscripts.

Perils not included

This company shall not be liable for loss by fire or other perils insured against in this policy caused, directly or indirectly, by: (a) enemy attack by armed forces, including action taken by military, naval or air forces in resisting an actual or an immediately impending enemy attack; (b) invasion; (c) insurrection; (d) rebellion; (e) revolution; (f) civil war; (g) usurped power; (h) order of any civil authority except acts of destruction at the time of and for the purpose of preventing the spread of fire, provided that the fire did not originate from any of the perils excluded by this policy; (i) neglect of the insured to use all reasonable means to save and preserve the property at and after a loss, or when the property is endangered by fire in neighboring premises; (j) nor shall this company be liable for loss by theft.

Other insurance

Other insurance may be prohibited or the amount of insurance may be limited by endorsement attached hereto.

Conditions suspending or restricting insurance

Unless otherwise provided in writing added hereto this company shall not be liable for loss occurring (a) while the hazard is increased by any means within the control or knowledge of the insured; or (b) while a described building, whether intended for occupancy by owner or tenant, is vacant or unoccupied beyond a period of 60 consecutive days; or (c) as a result of explosion or riot, unless fire ensues, and in that event for loss by fire only.

Other perils or subjects

Any other peril to be insured against or subject of insurance to be covered in this policy shall be by endorsement in writing hereon or added hereto.

Added provisions

The extent of the application of insurance under this policy and of the contribution to be made by this company in case of loss, and any other provision or agreement not inconsistent with the provisions of this policy, may be provided for in writing added hereto, but no provision may be waived except such as by the terms of this policy or by statute is subject to change.

Waiver provisions

No permission affecting this insurance shall exist, or waiver of any provision be valid, unless granted herein or expressed in writing added hereto. No provision, stipulation or forfeiture shall be held to be waived by any requirement or proceeding on the part of this company relating to appraisal or to any examination provided for herein.

Cancellation of policy

This policy shall be canceled at any time at the request of the insured, in which case this company shall, upon demand and surrender of this policy, refund the excess of paid premium above the customary short rates for the expired time. This policy may be canceled at any time by this company by giving to the insured a 20 days’ written notice of cancellation with or without tender of the excess of paid premium above the pro rata premium for the expired time, which excess, if not tendered, shall be refunded on demand. Notice of cancellation shall state that said excess premium (if not tendered) will be refunded on demand. If the reason for cancellation is nonpayment of premium, this policy may be canceled by this company by giving to the insured a 10 days’ written notice of cancellation.

Mortgagee interests and obligations

If loss hereunder is made payable, in whole or in part, to a designated mortgagee not named herein as the insured, the interest in this policy may be canceled by giving to the mortgagee a 10 days’ written notice of cancellation.

If the insured fails to render proof of loss the mortgagee, upon notice, shall render proof of loss in the form herein specified within 60 days thereafter and shall be subject to the provisions hereof relating to appraisal and time of payment and of bringing suit. If this company shall claim that no liability existed as to the mortgagor or owner, it shall, to the extent of payment of loss to the mortgagee, be subrogated to all the mortgagee’s rights of recovery, but without impairing mortgagee’s right to sue; or it may pay off the mortgage debt and require an assignment thereof and of the mortgage. Other provisions relating to the interests and obligations of the mortgagee may be added hereto by agreement in writing.

Pro rata liability

This company shall not be liable for a greater proportion of any loss than the amount hereby insured shall bear to the whole insurance covering the property against the peril involved, whether collectible or not.

Requirements in case loss occurs

The insured shall give written notice to this company of any loss without unnecessary delay, protect the property from further damage, forthwith separate the damaged and undamaged personal property, put it in the best possible order, furnish a complete inventory of the destroyed, damaged and undamaged property, showing in detail quantities, costs, actual cash value and amount of loss claimed; and within 60 days after the loss, unless the time is extended in writing by this company, the insured shall render to this company a proof of loss, signed and sworn to by the insured, stating the knowledge and belief of the insured as to the following: the time and origin of the loss, the interest of the insured and of all others in the property, the actual cash value of each item thereof and the amount of loss thereto, all encumbrances thereon, all other contracts of insurance, whether valid or not, covering any of said property, any changes in the title, use, occupation, location, possession or exposures of said property since the issuing of this policy, by whom and for what purpose any building herein described and the several parts thereof were occupied at the time of loss and whether or not it then stood on leased ground, and shall furnish a copy of all the descriptions and schedules in all policies and, if required and obtainable, verified plans and specifications of any building, fixtures or machinery destroyed or damaged.

The insured, as often as may be reasonably required and subject to the provisions of Section 2071.1, shall exhibit to any person designated by this company all that remains of any property herein described, and submit to examinations under oath by any person named by this company, and subscribe the same; and, as often as may be reasonably required, shall produce for examinations all books of account, bills, invoices, and other vouchers, or certified copies thereof if the originals be lost, at any reasonable time and place as may be designated by this company or its representative, and shall permit extracts and copies thereof to be made. The insurer shall inform the insured that tax returns are privileged against disclosure under applicable law but may be necessary to process or determine the claim.

The insurer shall notify every claimant that they may obtain, upon request, copies of claim-related documents. For purposes of this section, “claim-related documents” means all documents that relate to the evaluation of damages, including, but not limited to, repair and replacement estimates and bids, appraisals, scopes of loss, drawings, plans, reports, third-party findings on the amount of loss, covered damages, and cost of repairs, and all other valuation, measurement, and loss adjustment calculations of the amount of loss, covered damage, and cost of repairs. However, attorney work product and attorney-client privileged documents, and documents that indicate fraud by the insured or that contain medically privileged information, are excluded from the documents an insurer is required to provide pursuant to this section to a claimant. Within 15 calendar days after receiving a request from an insured for claim-related documents, the insurer shall provide the insured with copies of all claim-related documents, except those excluded by this section. Nothing in this section shall be construed to affect existing litigation discovery rights.

After a covered loss, the insurer shall provide, free of charge, a complete, current copy of this policy within 30 calendar days of receipt of a request from the insured. The time period for providing this policy may be extended by the Insurance Commissioner.

An insured who does not experience a covered loss shall, upon request, be entitled to one free copy of this policy annually. The policy provided to the insured shall include, where applicable, the policy declarations page.

Appraisal

In case the insured and this company shall fail to agree as to the actual cash value or the amount of loss, then, on the written request of either, each shall select a competent and disinterested appraiser and notify the other of the appraiser selected within 20 days of the request. Where the request is accepted, the appraisers shall first select a competent and disinterested umpire; and failing for 15 days to agree upon the umpire, then, on request of the insured or this company, the umpire shall be selected by a judge of a court of record in the state in which the property covered is located. Appraisal proceedings are informal unless the insured and this company mutually agree otherwise. For purposes of this section, “informal” means that no formal discovery shall be conducted, including depositions, interrogatories, requests for admission, or other forms of formal civil discovery, no formal rules of evidence shall be applied, and no court reporter shall be used for the proceedings. The appraisers shall then appraise the loss, stating separately actual cash value and loss to each item; and, failing to agree, shall submit their differences, only, to the umpire. An award in writing, so itemized, of any two when filed with this company shall determine the amount of actual cash value and loss. Each appraiser shall be paid by the party selecting him or her and the expenses of appraisal and umpire shall be paid by the parties equally. In the event of a government-declared disaster, as defined in the Government Code, appraisal may be requested by either the insured or this company but shall not be compelled.

Adjusters

If the company assigns a subsequent adjuster to be primarily responsible for a claim, the insurer, in a timely manner, shall provide the insured with a written status report within 15 calendar days of the assignment. For purposes of this section, a written status report shall include a summary of any decisions or actions that are substantially related to the disposition of a claim, including, but not limited to, the amount of losses to structures or contents, the retention or consultation of design or construction professionals, the amount of coverage for losses to structures or contents, the dollar amount of claims paid to date for each portion of coverage, and all items of dispute or pending.

Company’s options

It shall be optional with this company to take all, or any part, of the property at the agreed or appraised value, and also to repair, rebuild or replace the property destroyed or damaged with other of like kind and quality within a reasonable time, on giving notice of its intention so to do within 30 days after the receipt of the proof of loss herein required.

Abandonment

There can be no abandonment to this company of any property.

When loss payable

The amount of loss for which this company may be liable shall be payable 60 days after proof of loss, as herein provided, is received by this company and ascertainment of the loss is made either by agreement between the insured and this company expressed in writing or by the filing with this company of an award as herein provided.

Suit

No suit or action on this policy for the recovery of any claim shall be sustainable in any court of law or equity unless all the requirements of this policy shall have been complied with, and unless commenced within 12 months next after inception of the loss. If the loss is related to a state of emergency, as defined in subdivision (b) of Section 8558 of the Government Code, the time limit to bring suit is extended to 24 months after inception of the loss.

Subrogation

This company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefor is made by this company.

(b) Any amendments to this section made by Chapter 583 of the Statutes of 2001 shall govern a policy utilizing the form provided in subdivision (a) when that policy is originated or renewed on or after January 1, 2002.

(c) The amendments to this section made by Chapter 148 of the Statutes of 2003 shall govern a policy utilizing the form provided in subdivision (a) when that policy is originated or renewed on or after January 1, 2004.

(d) (1) The amendments to this section made by Chapter 639 of the Statutes of 2018 shall govern a policy originated or renewed on or after September 21, 2018.

(2) Notwithstanding paragraph (1), an insurer shall incorporate the revisions to the standard form of fire insurance policy made by Chapter 639 of the Statutes of 2018 on or before July 1, 2019.

(e) The amendments to this section made by Senate Bill 876 of the 2025–26 Regular Session shall govern a policy utilizing the form provided in subdivision (a) when that policy is originated or renewed on or after January 1, 2028.

SEC. 9.5.

Section 2071 of the Insurance Code is amended to read:

2071.

(a) The following is adopted as the standard form of fire insurance policy for this state:

California Standard Form Fire Insurance Policy

No.

[Space for insertion of name of company or companies issuing the policy and other matter permitted to be stated at the head of the policy.]

In consideration of the provisions and stipulations herein or added hereto and of ____ dollars premium this company, for the term of ________

from the ________ day of _______ , 20 _______	⎫	At 12:01 a.m.,
to the __________ day of ________ , 20 ______	⎭	standard time,

Assignment of this policy shall not be valid except with the written consent of this company.

IN WITNESS WHEREOF, this company has executed and attested these presents; but this policy shall not be valid unless countersigned by the duly authorized agent of this company at

_____ _____ Secretary.	_____ _____ President.
Countersigned this	day of , 20
_____ Agent

Concealment, fraud

Uninsurable and excepted property

This policy shall not cover accounts, bills, currency, deeds, evidences of debt, money or securities; nor, unless specifically named hereon in writing, bullion or manuscripts.

Perils not included

Other insurance

Other insurance may be prohibited or the amount of insurance may be limited by endorsement attached hereto.

Conditions suspending or restricting insurance

Other perils or subjects

Any other peril to be insured against or subject of insurance to be covered in this policy shall be by endorsement in writing hereon or added hereto.

Added provisions

Waiver provisions

Cancellation of policy

Mortgagee interests and obligations

Pro rata liability

Requirements in case loss occurs

The insurer shall notify every claimant that they may obtain, upon request, copies of claim-related documents. For purposes of this section, “claim-related documents” means all documents that relate to the evaluation of damages, including, but not limited to, repair and replacement estimates and bids, appraisals, scopes of loss, drawings, plans, reports, third-party findings on the amount of loss, covered damages, and cost of repairs, and all other valuation, measurement, and loss adjustment calculations, whether preliminary or final, that relate to the amount of loss, covered damage, and cost of repairs. However, attorney work product and attorney-client privileged documents, and documents that indicate fraud by the insured or that contain medically privileged information, are excluded from the documents an insurer is required to provide pursuant to this section to a claimant. Within 15 calendar days after receiving a request from an insured for claim-related documents, the insurer shall provide the insured with copies of all claim-related documents, except those excluded by this section. Nothing in this section shall be construed to affect existing litigation discovery rights.

Appraisal

Adjusters

Company’s options

Abandonment

There can be no abandonment to this company of any property.

When loss payable

Suit

Subrogation

This company may require from the insured an assignment of all right of recovery against any party for loss to the extent that payment therefor is made by this company.

(d) (1) The amendments to this section made by Chapter 639 of the Statutes of 2018 shall govern a policy originated or renewed on or after September 21, 2018.

(2) Notwithstanding paragraph (1), an insurer shall incorporate the revisions to the standard form of fire insurance policy made by Chapter 639 of the Statutes of 2018 on or before July 1, 2019.

SEC. 10.

Section 10102 of the Insurance Code is amended to read:

10102.

(a) The disclosure required by Section 10101 shall be in no less than 10-point type and shall be provided prior to or concurrent with the application for a policy of residential property insurance. In the event that an application is made by telephone, an insurer that mails a copy of the disclosure within three business days shall be in compliance with this section. For policies issued on or after July 1, 1993, the agent or insurer shall obtain the applicant’s signature acknowledging receipt of the disclosure form within 60 days of the date of the application. When the insurer or agent establishes delivery of the disclosure form by obtaining the signature of the applicant or insured, or when an insurer or agent provides the applicant with the disclosure form and the applicant does not return a signed acknowledgment of receipt within 60 days of the date it was provided, there shall be a conclusive presumption that the insurer or agent has complied with the disclosure requirement of this chapter. The insurer or agent shall have the burden of demonstrating in accordance with California Rules of Evidence that the disclosure was provided to the applicant or insured. A signature shall not be required at the time of renewal.

If the disclosure is mailed to the named insured or applicant, it shall be mailed to the mailing address shown on the policy of residential property insurance or to the address requested by the applicant. First-class mail shall be deemed adequate for proof of mailing. The insurer shall have the burden of demonstrating in accordance with California Rules of Evidence that the disclosure was mailed to the applicant or insured.

The disclosure shall contain the following language:

“NOTICE TO CONSUMERS — CALIFORNIA RESIDENTIAL INSURANCE DISCLOSURE

This disclosure is required by Section 10102 of the California Insurance Code. This form provides general information related to residential property insurance and is not part of your residential property insurance policy. Only the specific provisions of your policy will determine whether a particular loss is covered and the amount payable. The information provided does not preempt existing California law.

PRIMARY FORMS OF RESIDENTIAL DWELLING COVERAGE

You have purchased the coverage(s) checked below. NOTE: Actual Cash Value Coverage is the most limited level of coverage listed. Guaranteed Replacement Cost is the broadest level of coverage.

______ ACTUAL CASH VALUE COVERAGE for either a total or partial loss to the structure or its contents pays the amount it would cost you to repair, rebuild, or replace the thing lost or injured, less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less. A deduction for physical depreciation applies only to components of a structure that are normally subject to repair and replacement during the useful life of that structure.

______ REPLACEMENT COST COVERAGE is intended to provide for the cost to repair or replace the damaged or destroyed dwelling, without a deduction for physical depreciation. Many policies pay only the dwelling’s actual cash value until the insured has actually begun or completed repairs or reconstruction on the dwelling. Coverage only pays for replacement costs up to the limits specified in your policy.

______ EXTENDED REPLACEMENT COST COVERAGE is intended to provide for the cost to repair or replace the damaged or destroyed dwelling without a deduction for physical depreciation. Many policies pay only the dwelling’s actual cash value until the insured has actually begun or completed repairs or reconstruction on the dwelling. Extended Replacement Cost provides additional coverage above the dwelling limits up to a stated percentage or specific dollar amount. See your policy for the additional coverage that applies.

______ GUARANTEED REPLACEMENT COST COVERAGE covers the full cost to repair or replace the damaged or destroyed dwelling for a covered peril regardless of the dwelling limits shown on the policy declarations page.

______ BUILDING CODE UPGRADE COVERAGE, also called Ordinance and Law coverage, covers additional costs to repair or replace a dwelling to comply with the building codes and zoning laws in effect at the time of loss or rebuilding. These costs may otherwise be excluded by your policy. Meeting current building code requirements can add significant costs to rebuilding your home. Refer to your policy or endorsement for the specific coverage provided and coverage limits that apply.

READ YOUR POLICY AND POLICY DECLARATIONS PAGE CAREFULLY: The policy declarations page shows the specific coverage limits you have purchased for your dwelling, personal property, separate structures such as detached garages, and additional living expenses. The actual policy and endorsements provide details on extensions of coverage, limitations of coverage, and coverage conditions and exclusions. The amount of any claim payment made to you will be reduced by any applicable deductibles shown on your policy declarations page. It is important to take the time to consider whether the limits and limitations of your policy meet your needs. Contact your agent, broker, or insurance company if you have questions about what is covered or if you want to discuss your coverage options.

INFORMATION YOU SHOULD KNOW ABOUT RESIDENTIAL DWELLING INSURANCE

AVOID BEING UNDERINSURED: Insuring your home for less than its replacement cost may result in your having to pay thousands of dollars out of your own pocket to rebuild your home if it is completely destroyed. Contact your agent, broker, or insurance company immediately if you believe your policy limits may be inadequate.

THE RESIDENTIAL DWELLING COVERAGE LIMIT: The coverage limit on the dwelling structure should be high enough so you can rebuild your home if it is completely destroyed. Please note:

◼ The cost to rebuild your home is almost always different from the market value. ◼ Dwelling coverage limits do not cover the value of your land. ◼ The estimate to rebuild your home should be based on construction costs in your area and should be adjusted to account for the features of your home. These features include, but are not limited to, the square footage, type of foundation, number of stories, and the quality of the materials used for items such as flooring, countertops, windows, cabinetry, lighting, and plumbing. ◼ The cost to rebuild your home should be adjusted each year to account for inflation. ◼ Coverage limits for contents, separate structures, additional living expenses, and debris removal are usually based on a percentage of the limit for the dwelling. If your dwelling limit is too low, these coverage limits may also be too low.

You are encouraged to obtain a current estimate of the cost to rebuild your home from your insurance agent, broker, or insurance company or an independent appraisal from a local contractor, architect, or real estate appraiser. If you do obtain an estimate of replacement value and wish to change your policy limits, contact your insurance company. While not a guarantee, a current estimate can help protect you against being underinsured.

DEMAND SURGE: After a widespread disaster, the cost of construction can increase dramatically as a result of the unusually high demand for contractors, building supplies, and construction labor. This effect is known as demand surge. Demand surge can increase the cost of rebuilding your home. Consider increasing your coverage limits or purchasing Extended Replacement Cost coverage to prepare for this possibility.

CHANGES TO PROPERTY: Changes to your property may increase its replacement cost. These changes may include the building of additions, customizing your kitchen or bathrooms, or otherwise remodeling your home. Failure to advise your insurance company of any significant changes to your property may result in your home being underinsured.

EXCLUSIONS: Not all causes of damage are covered by common homeowners or residential fire policies. You need to read your policy to see what causes of loss or perils are not covered. Coverage for landslide is typically excluded. Some excluded perils such as earthquake or flood can be purchased as an endorsement to your policy or as a separate policy. Contact your agent, broker, or insurance company if you have a concern about any of the exclusions in your policy.

CONTENTS (PERSONAL PROPERTY) COVERAGE DISCLOSURE: This disclosure form does not explain the types of contents coverage provided by your policy for items such as your furniture or clothing. Contents may be covered on either an actual cash value or replacement cost basis depending on the contract. Almost all policies include specific dollar limitations on certain property that is particularly valuable, such as jewelry, art, or silverware. Contact your agent, broker, or insurance company if you have any questions about your contents coverage. You should create a list of all personal property in and around your home. Pictures and video recordings also help you document your property. The list, photos, and video should be stored away from your home.

CONSUMER ASSISTANCE: If you have any concerns or questions, contact your agent, broker, or insurance company. You are also encouraged to contact the California Department of Insurance consumer information line at (800) 927-HELP (4357) or at www.insurance.ca.gov for free insurance assistance.”

(b) The agent or insurer shall indicate on the disclosure form which coverages the applicant or insured has selected or purchased.

(c) The disclosure statement may contain additional provisions not conflicting with, annulling, or detracting from the foregoing.

(d) Following the issuance of the policy of residential property insurance, the insurer shall provide the disclosure statement to the insured on an every-other-year basis at the time of renewal. The disclosure required by this section may be transmitted with the material required by Section 10086.1.

(e) A policy of residential property insurance shall not be initially issued as guaranteed replacement cost coverage if it contains any maximum limitation of coverage based on any set dollar limits, percentage amounts, construction cost limits, indexing, or any other preset maximum limitation for covered damage to the insured dwelling. The limitations referred to in this section are solely applicable to dwelling structure coverages. Endorsements covering additional risks to the insurer’s dwelling structure coverage may have internal limits as long as those endorsements are not called guaranteed replacement cost coverage.

(f) A policy of residential property insurance shall not be renewed as guaranteed replacement cost coverage if it contains any maximum limitation of coverage based on any set dollar limits, percentage amounts, construction cost limits, indexing, or any other preset maximum limitation for covered damage to the insured dwelling. The limitations referred to in this section are solely applicable to dwelling structure coverages. Endorsements covering additional risks to the insurer’s dwelling structure coverage may have internal limits as long as those endorsements are not called guaranteed replacement cost coverage.

(g) Coverage provided for building code upgrades by a policy of residential property insurance shall be applicable to building codes, ordinances, standards, or laws only to the extent that those codes, ordinances, standards, or laws do not impose stricter standards on the property on the basis of the level of insurance coverage applicable to the property.

(h) The disclosure required by Section 10101 shall also be provided to the mortgagor in the event that a policy is forced placed by an insurer at the request of a mortgagee. In those cases, neither the insurer nor the mortgagee shall be required to obtain a signature from the mortgagor. A disclosure shall not be required to be provided with respect to blanket policies issued to a mortgagee, and designed to provide interim coverage for losses occurring before the mortgagee has knowledge of the lapse of the policy and before placement of a policy on behalf of the mortgagor.

(i) A disclosure required by Section 10101 that is provided on and after January 1, 2020, shall include any fire safety-related discounts offered by the insurer.

(j) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 11.

Section 10102 is added to the Insurance Code, to read:

10102.

The disclosure shall contain the following language:

“NOTICE TO CONSUMERS — CALIFORNIA RESIDENTIAL INSURANCE DISCLOSURE

This disclosure is required by Section 10102 of the California Insurance Code. This form provides general information related to residential property insurance and is not part of your residential property insurance policy. Only the specific provisions of your policy will determine whether a particular loss is covered and the amount payable. The information provided does not preempt existing California law.

PRIMARY FORMS OF RESIDENTIAL DWELLING COVERAGE

You have purchased the coverage(s) checked below. NOTE: Actual Cash Value Coverage is the most limited level of coverage listed. Guaranteed Replacement Cost is the broadest level of coverage.

______ ACTUAL CASH VALUE COVERAGE for either a total or partial loss to the structure or its contents pays the amount it would cost you to repair, rebuild, or replace the thing lost or injured, less a fair and reasonable deduction for physical depreciation based upon its condition at the time of the injury or the policy limit, whichever is less. A deduction for physical depreciation applies only to components of a structure that are normally subject to repair and replacement during the useful life of that structure.

______ REPLACEMENT COST COVERAGE is intended to provide for the cost to repair or replace the damaged or destroyed dwelling, without a deduction for physical depreciation. Many policies pay only the dwelling’s actual cash value until the insured has actually begun or completed repairs or reconstruction on the dwelling. Coverage only pays for replacement costs up to the limits specified in your policy.

______ EXTENDED REPLACEMENT COST COVERAGE is intended to provide for the cost to repair or replace the damaged or destroyed dwelling without a deduction for physical depreciation. Many policies pay only the dwelling’s actual cash value until the insured has actually begun or completed repairs or reconstruction on the dwelling. Extended Replacement Cost provides additional coverage above the dwelling limits up to a stated percentage or specific dollar amount. See your policy for the additional coverage that applies.

______ GUARANTEED REPLACEMENT COST COVERAGE covers the full cost to repair or replace the damaged or destroyed dwelling for a covered peril regardless of the dwelling limits shown on the policy declarations page.

______ BUILDING CODE UPGRADE COVERAGE, also called Ordinance and Law coverage, covers additional costs to repair or replace a dwelling to comply with the building codes and zoning laws in effect at the time of rebuilding and required for rebuilding. These costs may otherwise be excluded by your policy. Meeting current building code requirements can add significant costs to rebuilding your home. Refer to your policy or endorsement for the specific coverage provided and coverage limits that apply.

READ YOUR POLICY AND POLICY DECLARATIONS PAGE CAREFULLY: The policy declarations page shows the specific coverage limits you have purchased for your dwelling, personal property, separate structures such as detached garages, and additional living expenses. The actual policy and endorsements provide details on extensions of coverage, limitations of coverage, and coverage conditions and exclusions. The amount of any claim payment made to you will be reduced by any applicable deductibles shown on your policy declarations page. It is important to take the time to consider whether the limits and limitations of your policy meet your needs. Contact your agent, broker, or insurance company if you have questions about what is covered or if you want to discuss your coverage options.

INFORMATION YOU SHOULD KNOW ABOUT RESIDENTIAL DWELLING INSURANCE

AVOID BEING UNDERINSURED: Insuring your home for less than its replacement cost may result in your having to pay thousands of dollars out of your own pocket to rebuild your home if it is completely destroyed. Contact your agent, broker, or insurance company immediately if you believe your policy limits may be inadequate.

THE RESIDENTIAL DWELLING COVERAGE LIMIT: The coverage limit on the dwelling structure should be high enough so you can rebuild your home if it is completely destroyed. Please note:

◼ The cost to rebuild your home is almost always different from the market value. ◼ Dwelling coverage limits do not cover the value of your land. ◼ The estimate to rebuild your home should be based on construction costs in your area and should be adjusted to account for the features of your home. These features include, but are not limited to, the square footage, type of foundation, number of stories, and the quality of the materials used for items such as flooring, countertops, windows, cabinetry, lighting, and plumbing. ◼ The cost to rebuild your home should be adjusted each year to account for inflation. ◼ Coverage limits for contents, separate structures, additional living expenses, and debris removal are usually based on a percentage of the limit for the dwelling. If your dwelling limit is too low, these coverage limits may also be too low.

You are encouraged to obtain a current estimate of the cost to rebuild your home from your insurance agent, broker, or insurance company or an independent appraisal from a local contractor, architect, or real estate appraiser. If you do obtain an estimate of replacement value and wish to change your policy limits, contact your insurance company. While not a guarantee, a current estimate can help protect you against being underinsured.

DEMAND SURGE: After a widespread disaster, the cost of construction can increase dramatically as a result of the unusually high demand for contractors, building supplies, and construction labor. This effect is known as demand surge. Demand surge can increase the cost of rebuilding your home. Consider increasing your coverage limits or purchasing Extended or Guaranteed Replacement Cost coverage to prepare for this possibility.

CHANGES TO PROPERTY: Changes to your property may increase its replacement cost. These changes may include the building of additions, customizing your kitchen or bathrooms, or otherwise remodeling your home. Failure to advise your insurance company of any significant changes to your property may result in your home being underinsured.

EXCLUSIONS: Not all causes of damage are covered by common homeowners or residential fire policies. You need to read your policy to see what causes of loss or perils are not covered. Coverage for landslide is typically excluded. Some excluded perils such as earthquake or flood can be purchased as an endorsement to your policy or as a separate policy. Contact your agent, broker, or insurance company if you have a concern about any of the exclusions in your policy.

CONTENTS (PERSONAL PROPERTY) COVERAGE DISCLOSURE: This disclosure form does not explain the types of contents coverage provided by your policy for items such as your furniture or clothing. Contents may be covered on either an actual cash value or replacement cost basis depending on the contract. Almost all policies include specific dollar limitations on certain property that is particularly valuable, such as jewelry, art, or silverware. Contact your agent, broker, or insurance company if you have any questions about your contents coverage. You should create a list of all personal property in and around your home. Pictures and video recordings also help you document your property. The list, photos, and video should be stored away from your home.

CONSUMER ASSISTANCE: If you have any concerns or questions, contact your agent, broker, or insurance company. You are also encouraged to contact the California Department of Insurance consumer information line at (800) 927-HELP (4357) or at www.insurance.ca.gov for free insurance assistance.”

(b) The agent or insurer shall indicate on the disclosure form which coverages the applicant or insured has selected or purchased.

(c) The disclosure statement may contain additional provisions not conflicting with, annulling, or detracting from the foregoing.

(i) A disclosure required by Section 10101 that is provided on and after January 1, 2020, shall include any fire safety-related discounts offered by the insurer.

(j) This section shall become operative on January 1, 2028.

SEC. 12.

Section 10103 of the Insurance Code is amended to read:

10103.

(a) A policy of residential property insurance shall not be issued or renewed in this state unless it provides the following information on the declarations page of the policy:

(1) The limits of liability for the structure.

(2) The following statement regarding the valuation of the structure:

“The limit of liability for this structure (Coverage A) is based on an estimate of the cost to rebuild your home, including an approximate cost for labor and materials in your area, and specific information that you have provided about your home.”

(3) Limits of liability for personal property.

(4) Deductibles.

(5) For a residential property insurance policy that provides replacement cost coverage, a statement that the policy provides building code upgrade coverage for the increased costs of repairing or replacing damage to the insured dwelling caused by a covered loss because of building ordinances or laws regulating the repair or replacement. Building code upgrade coverage is provided based on the increased costs associated with building ordinances or laws in effect at the time of loss or rebuilding, up to policy limits for this coverage. The policy may denote restrictions, if any, on coverage for compliance with applicable building codes that take effect after the date of loss, but before the issuance of required building permits.

(b) If the policy includes building code upgrade coverage, it shall do both of the following:

(1) State it includes building code upgrade coverage on the declaration page in no less than 10-point type, state any applicable limits on the amount of coverage, and, if the policy contains other terms, conditions, or restrictions for coverage, disclose on the declarations page that those terms, conditions, or restrictions are identified on a separate disclosure form attached to the declarations page.

(2) If the building code upgrade coverage is subject to any terms, limits, conditions, or restrictions, state the terms, limits, conditions, or restrictions on a separate disclosure form attached to the declarations page. The separate disclosure form shall be printed in no less than 10-point type.

(c) An open policy of residential property insurance that provides replacement cost coverage shall not be issued or renewed unless it provides additional building code upgrade coverage of no less than 10 percent of the dwelling coverage policy limits. The building code upgrade coverage required by this subdivision shall be additional coverage, and use of this coverage shall not reduce or deplete the dwelling coverage policy limits for the insured property. This subdivision does not prohibit an insurer from offering building code upgrade coverage of greater than 10 percent of the dwelling coverage policy limits, in addition to providing the minimum coverage of 10 percent of the dwelling coverage policy limits.

(d) The provisions of paragraphs (1), (2), and (5) of subdivision (a), subdivision (b), and subdivision (c) are not required for policies purchased by tenants or unit owners that do not cover the structure of the premises.

(e) (1) The requirements of paragraph (5) of subdivision (a), subdivision (b), and subdivision (c) do not apply to a policy of residential property insurance that provides actual cash value coverage and does not provide replacement cost coverage or building code upgrade coverage.

(2) The requirements of subdivision (c) do not apply to a policy of residential property insurance that is an apartment policy, a tenant’s policy, a renter’s policy, a mobilehome policy, or a policy insuring individually owned condominium units, if the policy of residential property insurance does not provide dwelling structure coverage. The requirements of subdivision (c) also do not apply to a policy covering all or part of a commercial or farm operation, including a policy covering a structure or dwelling unit on commercial or farm property, regardless of whether the structure or dwelling unit is owner occupied or rented for individual residential purposes.

(3) A policy of residential property insurance that does not provide building code upgrade coverage shall include on the declarations page of the policy in no less than 10-point type the following statement: “THIS POLICY DOES NOT INCLUDE BUILDING CODE UPGRADE COVERAGE.”

(f) The amendments to this section made by the act adding this subdivision shall be operative for any policy issued or renewed on or after July 1, 2021, except that an insurer that files a complete rate application, including, without limitation, a form change application or rule filing, by no later than April 1, 2021, in order to comply with the provisions of this act, shall begin issuing and renewing policies in compliance with this section within 75 days following the commissioner’s prior approval of that complete rate application, including, without limitation, a form change application or rule filing.

(g) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 13.

Section 10103 is added to the Insurance Code, to read:

10103.

(a) A policy of residential property insurance shall not be issued or renewed in this state unless it provides the following information on the declarations page of the policy:

(1) The limits of liability for the structure.

(2) The following statement regarding the valuation of the structure:

(3) Limits of liability for personal property.

(4) Deductibles.

(5) For a residential property insurance policy that provides replacement cost coverage, a statement that the policy provides building code upgrade coverage for the increased costs of repairing or replacing damage to the insured dwelling caused by a covered loss because of building ordinances or laws regulating the repair or replacement. Building code upgrade coverage is provided based on the increased costs associated with building ordinances or laws in effect at the time of rebuilding and required for rebuilding, up to policy limits for this coverage. The policy may denote restrictions, if any, on coverage for compliance with applicable building codes that take effect more than three years after the date of loss and are required for rebuilding.

(b) If the policy includes building code upgrade coverage, it shall do both of the following:

(f) This section shall become operative on January 1, 2028.

SEC. 14.

Section 10103.2 of the Insurance Code is amended to read:

10103.2.

(a) On and after July 1, 2020, upon an offer of a policy of residential property insurance, a disclosure shall be provided to the applicant that states policies offering extended replacement cost coverage of at least 50 percent may be available for that property and that includes the internet website address of the department’s Homeowners Coverage Comparison Tool, pursuant to the following conditions:

(1) If an insurer does not offer at least 50 percent above the residential dwelling coverage limit to the applicant, the insurer shall provide the disclosure.

(2) If an insurer, utilizing an agent or broker, does not offer an applicant at least 50 percent above the residential dwelling coverage limit to the applicant, the insurer, agent, or broker shall provide the disclosure.

(3) If an agent or broker provides quotes to a consumer from multiple insurers, but none of the offers include coverage at least 50 percent above the residential dwelling coverage limit, the agent or broker shall provide the disclosure.

(b) (1) If an insurer offers at least 50 percent above the residential dwelling coverage limit to the applicant, the insurer is not required to make a disclosure pursuant to subdivision (a).

(2) If an agent or broker provides quotes to a consumer from multiple insurers, and at least one of the insurers offers 50 percent above the residential dwelling coverage limit, the insurer, agent, or broker is not required to make a disclosure pursuant to subdivision (a).

(c) An insurer that offers policies of residential property insurance shall notify the department on or before February 1 of each year of the amount of extended replacement cost coverage offered by the insurer for each policy or product it sells in California if the amount is different than what was reported in the previous year. The department shall use this information to annually update the Homeowners Coverage Comparison Tool on the department’s internet website.

(d) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 15.

Section 10103.2 is added to the Insurance Code, to read:

10103.2.

(a) A residential property insurance policy shall not be issued or renewed in this state unless the applicant or insured is offered extended replacement cost coverage, as defined in Section 10102, in an amount of no less than 50 percent of coverage above the policy limits for the primary dwelling. The offer shall be accompanied by the premium charge for this additional coverage.

(b) If an applicant or policyholder declines the offer made pursuant to subdivision (a), the insurer shall record acknowledgment of the declination and identify the declination on the declaration page of the policy that extended replacement cost coverage of at least 50 percent was offered and is being declined.

(c) An insurer that offers residential property insurance policies shall notify the department on or before February 1 of each year of the amount of extended replacement cost coverage offered by the insurer for each policy or product it sells in California if the amount is different than what was reported in the previous year. The department shall use this information to annually update the Homeowners Coverage Comparison Tool on the department’s internet website.

(d) This section applies only to applicants and policyholders whose properties are eligible for replacement cost coverage.

(e) This section shall become operative on January 1, 2028.

SEC. 16.

Section 10103.4 of the Insurance Code is amended to read:

10103.4.

(a) An insurer that provides replacement cost coverage in accordance with Section 10102, except an insurer that satisfies the requirements of subdivision (b), shall, on an every other year basis, at the time an offer to renew a policy of residential property insurance is made to the policyholder, provide an estimate of the cost necessary to rebuild or replace the insured structure that complies with Sections 2695.180 to 2695.183, inclusive, of Article 1.3 of Subchapter 7.5 of Chapter 5 of Title 10 of the California Code of Regulations, as those sections provided on January 1, 2018.

(b) An insurer that satisfies either of the following is not subject to subdivision (a):

(1) The policyholder has requested, within the two years prior to the offer to renew the policy, and the insurer has provided, coverage limits greater than the previous limits that the policyholder had selected.

(2) The insurer has, in connection with its annual offer to renew the policy, done both of the following:

(A) Offers, on an every other year basis, the policyholder the right to have a new estimate of the replacement cost for the insured dwelling, that is compliant with Sections 2695.180 to 2695.183, inclusive, of Article 1.3 of Subchapter 7.5 of Chapter 5 of Title 10 of the California Code of Regulations, as those sections provided on January 1, 2018, provided the policyholder provides the necessary, requested information.

(B) Offered the renewal of the policy and the dwelling coverage limit in the renewal offer is based on an inflation factor that reflects the cost of construction in the policyholder’s geographic area. This paragraph applies whether or not the policyholder has elected to accept that coverage limit.

(c) This section shall not be deemed to limit or preclude an insurer and insured from agreeing to provide coverage for a policy limit that is greater or lesser than the estimate of replacement value provided in accordance with subdivision (a).

(d) This section is not intended to change existing law with respect to the duty of the policyholder or applicant to select the coverage limits for a policy of residential property insurance.

(e) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 17.

Section 10103.4 is added to the Insurance Code, to read:

10103.4.

(a) An insurer that provides replacement cost coverage in accordance with Section 10102 shall, on an every other year basis, at the time an offer to renew a policy of residential property insurance is made to the policyholder, provide an estimate of the cost necessary to rebuild or replace the insured structure that complies with Sections 2695.180 to 2695.183, inclusive, of Article 1.3 of Subchapter 7.5 of Chapter 5 of Title 10 of the California Code of Regulations, as those sections provided on January 1, 2018.

(b) This section does not limit or preclude an insurer and insured from agreeing to provide coverage for a policy limit that is greater or lesser than the estimate of replacement value provided in accordance with subdivision (a).

(c) This section also applies to a residential property insurance policy provided by the California FAIR Plan Association if replacement cost coverage is available under the policy and the policy limit being offered or provided is less than the maximum combined policy limit available under this program.

(d) This section shall become operative on January 1, 2028.

SEC. 18.

Section 10103.8 is added to the Insurance Code, to read:

10103.8.

(a) A residential property insurer doing business in this state shall submit to the department a detailed disaster response plan outlining how the insurer will handle claims arising from a disaster, including communication with policyholders, customer service continuity, adjuster training and deployment, ability to track disaster claims data, and overall operations staffing during widescale disasters relating to policies underwritten by the insurer in this state.

(b) The initial disaster response plan required pursuant to subdivision (a) shall be submitted to the department before April 1, 2028. The disaster response plan shall be updated every two years or upon request by the commissioner.

(c) The commissioner may require postdisaster progress reports or a comprehensive performance review of an insurer’s disaster response plan.

(d) If there is a covered loss relating to a state of emergency, as defined in Section 8558 of the Government Code, a residential property insurer shall do the following:

(1) No later than 15 calendar days from the date on which the insurer received notice of the claim, provide the claimant with a copy of the most recent notice described in paragraph (1) of subdivision (a) of Section 14046 and a toll-free telephone number that an affected claimant may call for answers to questions, including questions about the claim and coverage under the policy.

(2) No later than 30 calendar days from the date on which the state of emergency was declared, report to the commissioner the losses, claims, and estimate of total incurred losses for review. The commissioner shall make a determination based on the initial information as to how often claims data should be updated and whether or not to publish aggregate data on the department’s internet website.

(e) The commissioner shall maintain a list of contact information for local officials and community-based organizations that may provide pertinent information upon the occurrence of a wildfire emergency event.

(f) The commissioner may issue guidance to insurers regarding the content of the disaster response plan, require regular updates on disaster claims and loss data, and require compliance with other provisions in this section. The guidance issued by the commissioner shall not be subject to the Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code).

(g) Information submitted pursuant to this section, including disaster response plans, claims data, vendor information, staffing plans, operations protocols, business continuity plans, reserve or incurred-loss information, and related materials shall be confidential and shall not be subject to disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) or otherwise made public, except that the commissioner may publish aggregated and anonymized information that does not identify an insurer, insured, claimant, policy, claim, vendor, trade secret, proprietary model, or confidential business process.

(h) This section does not require production or disclosure of attorney-client privileged information, attorney work product, reserve information, internal deliberative materials, Special Investigative Unit or fraud investigation materials, cybersecurity-sensitive information, proprietary vendor information, or personally identifiable policyholder information, except as otherwise required under existing law and subject to applicable confidentiality protections.

(i) This section shall become operative on January 1, 2028.

SEC. 19.

Section 12928.7 of the Insurance Code is amended to read:

12928.7.

(a) The commissioner may order a respondent to provide restitution for a loss arising from the respondent’s conduct. If the facts and equity permit, with a restitution order, the commissioner may issue an order of rescission enforceable on any person subject to the commissioner’s jurisdiction.

(b) A restitution order under this section shall meet all of the following requirements:

(1) The respondent shall be subject to the commissioner’s jurisdiction.

(2) The restitution order shall be ancillary to another proceeding authorized by this code in which the commissioner does both of the following:

(A) Determines the respondent violated this code or the standards of conduct applicable to persons acting in the capacity the respondent was acting in or purporting to act in when the loss occurred.

(B) Issues an order imposing a cease and desist order, an order for a monetary penalty, or another sanction with respect to the respondent’s conduct.

(3) The restitution order shall cite the factual basis for the restitution order.

(4) The restitution order shall state the persons, or classes of persons, who suffered a loss.

(5) The restitution order shall state the amount to be paid or property to be returned as restitution.

(c) A rescission or restitution order shall be subject to judicial review in the same manner and at the same time as the order to which it is ancillary.

(d) A rescission or restitution order may be judicially enforced in an action brought by the commissioner, the Attorney General, a district attorney, a city attorney, or any person owed restitution pursuant to the order. In that action, the court may award attorney’s fees and court costs to a prevailing plaintiff.

(e) This section does not apply to an insurer authorized to transact business in this state or to a placement of insurance with an insurer that was in compliance with Section 1765.1 or 1765.2 at the time of the placement. This section does not apply to a person with respect to acts within the scope of a license issued under Chapter 5 (commencing with Section 1621), Chapter 5A (commencing with Section 1759), or Chapter 6 (commencing with Section 1760) of Part 2 if the person holds that license at the time of those acts or at the time an initial pleading seeking restitution is issued.

(f) The commissioner may order a respondent who is ordered to provide restitution pursuant to this section to reimburse the commissioner for the commissioner’s costs of implementing and enforcing this section, including attorney’s fees. The commissioner shall not credit any funds received from a respondent towards payment of a monetary penalty until restitution has been tendered to all persons to whom restitution is owed, or to the commissioner on their behalf, as required by a restitution order.

(g) This section does not limit or restrict actions, remedies, or procedures otherwise available to the commissioner, the department, or any person pursuant to an administrative or civil action to enforce any law. It is not a defense in an administrative or civil action that the commissioner did not order a person to pay restitution.

(h) This section does not expand, limit, or otherwise affect the commissioner’s authority to seek or to have sought restitution, refunds, or penalties against insurers, except as expressly provided.

(i) As used in this section, “restitution” means the full amount that will compensate each person for their direct and indirect financial and nonfinancial losses proximately caused by the respondent’s violations.

(j) Money received by the commissioner for distribution to persons as restitution pursuant to this section or Section 12928.6 or 12976 shall be deposited into the Insurance Fund.

(k) This section shall remain in effect only until January 1, 2028, and as of that date is repealed.

SEC. 19.5.