SACRAMENTO — California lawmakers passed laws that would ensure insurance companies provide better coverage for smoke-damaged homes and financing for upgrades protecting residences from future fire damage.
The measures were among a slew of bills approved during the 2026 legislative session to deal with the continuing aftermath of the devastating 2025 Los Angeles area fires.
The Eaton and Palisades fires, which destroyed more than 16,000 structures and killed 31, were two of the deadliest and most destructive fires in state history. Like with catastrophic fires before them, tragedy spurred action.
Much of the focus on wildfire issues by Gov. Gavin Newsom and California lawmakers in the waning days of the legislative session focused on a proposal to shift liability away from utilities whose equipment ignites wildfires.
The complex, high-stakes policy debate attempted to address the needs and financial risks faced by the utilities, their customers and insurance companies following the catastrophic wildfires that have plagued California in recent years, but a proposed compromise recently pieced together by lawmakers and the governor fell through Tuesday.
However, lawmakers did pass several bills this year to help fire victims navigate burdensome insurance requirements in the aftermath of a disaster and increase prevention efforts. All head to Newsom for his consideration.
Two complementary bills approved Monday ensure homes that survive a wildfire but are contaminated by the onslaught of smoke are properly remediated before residents move back in.
The bills were prompted by the 2025 Eaton fire, which left thousands of homes contaminated with lead, some at levels hundreds of times what the U.S. Environmental Protection Agency considers safe. Homeowners routinely reported that their insurance companies refused or delayed claims, advocated for cleaning methods that experts deemed insufficient and pushed residents to move back before testing showed their homes were safe.
The first bill, AB 1642, would direct the Department of Toxic Substances Control to create scientific standards for what constitutes a safe home and provide guidance on how to properly remediate homes. The second, AB 1795, would require insurers to abide by those standards in the claims process and do so in a timely manner.
The companion laws only take effect if Newsom signs both.
The two bills originally conflicted with one another. The scientific standards bill was supported by many Eaton fire survivors from the get-go. However, the insurance bill — born out of a Department of Insurance task force — was widely criticized by survivors for leaving insurance companies wiggle room to deny claims and placing a burden on homeowners to prove their home was in fact contaminated by a fire.
In an eleventh-hour sprint of “sleepless nights,” “five-hour Zooms” and intervention from the governor’s office, advocates won additional protections for fire survivors in the insurance bill and brought the two into harmony, said Dawn Fanning, managing director at the smoke-damaged home advocacy group Eaton Fire Residents United.
“It took a lot of work to get here, and we’re really happy where we landed,” Fanning said.
After the Eaton fire, “it was the Wild West, trying to scramble to find answers,” she said. “If these laws were in place, so many thousands of people would be back home by now.”
Separate legislation by Sen. Benjamin Allen (D-Santa Monica), who is in a hotly contested race for California Insurance Commissioner, seeks to give homeowners more notice and options before being dropped by their insurer, a problem homeowners increasingly face as wildfires have become more frequent and destructive.
Many nonrenewal notices sent by insurance companies include vague reasoning, Allen said during a May hearing on the bill, SB 1301. His legislation would require specific information so property owners can have a chance to mitigate problems and keep their insurance.
Another bill from Allen, who represents the Palisades area that burned in 2025, would create a new loan program to help property owners mitigate fire risks through home hardening, or installing fire-resistant materials on the outside of a structure.
“It can sometimes cost tens of thousands of dollars for homeowners and there’s simply not a lot of financing for this kind of work. There’s not a market for that,” Allen said during an April hearing.
The program is expected to help fund 1,000 projects in its first year and up to 2,400 within five years, according to a bill analysis.
A budget bill approved Tuesday morning also includes $25 million for home hardening grants, rebates or loans to be distributed through a separate program to be created by the Governor’s Office of Emergency Services. It would cap assistance at $25,000 per homeowner or property.
But other proposals to provide financial incentives for home hardening did not pass, including bills by Assemblymember Steve Bennett (D-Ventura) to exclude home hardening upgrades from property tax reassessment and to require insurance companies to provide two quotes to inquiring homeowners: one for the property as is, and another for if it met full home-hardening certification by the state.
Another bill on Newsom’s desk seeks to get restitution for victims of utility-caused wildfires who in some cases have waited more than a decade, said Assemblymember Joe Patterson (R-Rocklin).
In 2019, the state established a wildfire fund paid by utility companies that reimburses claims stemming from wildfires caused by the companies’ equipment. But the fund was not retroactive, and some people who suffered losses before its creation are still waiting to be paid.
Patterson’s bill requires the California Public Utilities Commission to determine how much is still owed to those victims, including for losses from the deadly Camp fire that was sparked by a PG&E power line and destroyed the town of Paradise in 2018.
“For years, wildfire survivors have been forced to wait for answers while restitution shortfalls remain unresolved,” Patterson said in a statement after the bill passed. “AB 2700 is about doing what is right for wildfire survivors who have waited far too long to be made whole.”
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