Two bills designed to ensure insurance firms deliver the payouts owed to fire survivors cleared the Assembly Insurance committee today with strong majorities and zero opposition.

The measures, Senate Bills 877 and 878 introduced by Senator Sasha Renee Perez and backed by the Every Fire Survivors Network along with Consumer Watchdog, emerged after numerous personal stories from Los Angeles fire survivors highlighted how insurer delays and short payments create ongoing hardship and slow rebuilding efforts.

A separate measure addressing the LA fires, SB 1301 from Senator Ben Allen, aims to help residents retain existing home insurance and faces a committee vote next Wednesday.

Today's action moves every premium-paying Californian closer to safeguards against widespread delays and underpayments that have slowed recovery for many households. Insurance represents a commitment, and residents expect that commitment honored, said Joy Chen, Executive Director of Every Fire Survivors Network.

Policyholders maintained their coverage for years or even decades only to face resistance from insurers at the moment of greatest need. These proposals will accelerate the payments homeowners deserve and bring claim underpayments into public view, said Carmen Balber, executive director of Consumer Watchdog.

Today we advanced efforts to support fire survivors through greater openness and responsibility from the insurance sector, said Senator Sasha Renee Perez (D-Pasadena). SB 877 promotes transparency in loss estimates for homeowners, while SB 878 imposes penalties for avoidable delays in claim payments. Combined, these steps will stop insurers from obstructing recovery for those affected by the Eaton and Palisades fires. I appreciate the sponsors strong advocacy on behalf of California policyholders.

SB 877 assists consumers in disputing low claim amounts by mandating that insurers reveal all initial loss estimates along with any later changes. Homeowners have a right to see those figures if adjustments occur.

The proposal targets a practice observed in the LA fires and other large-scale disasters, where carriers have modified, lowered, or replaced original loss estimates without homeowner review. After Hurricane Ian, investigations exposed routine reductions in estimates. Recent congressional testimony described estimate alterations as a common method to postpone payments, wear down survivors, and push families toward smaller settlements.

SB 877 is straightforward. It compels insurers to present homeowners with the starting loss estimates so any modifications become visible. After enduring such losses, basic openness is the minimum expectation, said Sam Strgacich, who testified today. His Pasadena residence remains contaminated with toxins from the fire.

SB 878 reinforces current rules on claim timing by requiring written responses within deadlines and adds penalties for delayed payment of agreed amounts. It also accelerates post-disaster disbursements by mandating actual cash value payments for total losses within thirty days after a declared event. Insurers would further need to release undisputed replacement cost portions within thirty days once a homeowner signs a rebuild contract or buys a replacement property.

SB 878 centers on responsibility. Families who lost everything should not endure repeated delays just to obtain the funds they are due, said Damon Blount, an Eaton fire survivor who testified and lost both home and business.

Investigations into insurance practices after the LA fires revealed internal guidelines instructing adjusters to avoid written claim decisions. Thousands of accounts gathered by EFSN detail recurring delay methods including partial disputes that hold up undisputed sums, frequent adjuster changes that erase progress, verbal-only rejections that block appeals, and extended claims without formal rulings.

The bills cleared the Senate and now proceed to the Assembly Appropriations Committee.

SOURCE Consumer Watchdog