Consumer Watchdog has stepped into California’s insurance wars with a counter ballot initiative, filed Sept. 19, aimed at protecting Proposition 103 against a rival measure backed by an insurance agent.
The group says it didn’t seek a fight but is ready to finish one, proposing rules that expand consumer rights and tighten insurer obligations.
The plan requires homeowners insurers to write coverage for properties that meet wildfire mitigation standards defined by the state Department of Insurance. Any carrier that abandons the line would face a five-year ban on selling auto or homeowners policies in California.
Insurers would also be barred from dropping or denying coverage when a homeowner inquires about a claim, files one that’s not covered, or submits a claim where another party is at fault if the loss exposure has been addressed.
The initiative doubles down on Proposition 103 principles: mandatory prior approval of rate hikes, an elected insurance commissioner rather than an appointed one, and retention of the intervenor system—frequently used by Consumer Watchdog itself.
Branded as a “Policyholder Bill of Rights,” the proposal also forces insurers to give six months’ notice before nonrenewal, plus a detailed repair roadmap that would restore coverage if the homeowner makes improvements in time.
Auto insurance rules would tighten too, limiting underwriting to safety records and factors within a driver’s control. That move drew sharp criticism from industry.
Christian Rataj of NAMIC warned that cutting out proven rating variables would distort risk, making safer drivers subsidize riskier ones. He argued the plan runs against the Department of Insurance’s recent Sustainable Insurance Strategy, designed to bring insurers back into the market.
The insurance broker’s ballot measure is an existential threat to insurance policyholders who will face more skyrocketing rates and less available coverage if it were to pass.
Jamie Court, president of Consumer Watchdog and an initiative proponent
“We didn’t ask for this fight, but since the insurance broker started it we are prepared to finish it by addressing what consumers care most about, having home insurance coverage available when they do the right thing and protecting themselves against price gouging and unfair practices,” said Jamie Court.
“Homeowners deserve to know that when they do the right thing and make their homes safe from wildfires they will have access to home insurance,” said initiative proponent Carmen Balber, executive director of Consumer Watchdog.
“The Insurance Policyholder Bill of Rights guarantees that people who invest in wildfire mitigation get coverage and prevents companies from cancelling people simply because they file a claim. California policyholders need more rights, not less, and more independence from their insurance commissioners, not one who hails from the insurance industry.”
California voters passed 103 during a period of skyrocketing rates to protect themselves against the very same abuses that the new insurance initiative would replace it with.
Harvey Rosenfield, author of Prop 103 and founder of Consumer Watchdog
“Californians don’t want to go back to a time when the insurance commissioner came from the insurance industry, insurance companies could raise rates as much as they wanted, charge motorists based on any criteria they want, including their ZIP-code or refuse people based on their race, religion or income – and the voters had no power to hold insurance companies or the commissioner accountable. The Insurance Policyholder Bill of Rights gives Californians a way to preserve and strengthen the strong regulation already in California law.”
Denni Ritter of American Property Casualty Insurance Association state government affairs vice president blasted Consumer Watchdog’s measure as a publicity stunt, accusing the group of exploiting the intervenor system to collect millions while delaying rate filings and driving up costs. She said the proposal distracts from real solutions and risks deepening California’s fragile insurance market.
Ritter accused the organization of exploiting a “broken intervenor process for its own financial gain, pocketing millions while driving up costs and delaying access to coverage for consumers”.
Instead of offering real solutions to stabilize the market, this initiative is nothing more than another distraction at consumers’ expense that would only serve to worsen an already broken market.
Not everyone disagrees with the rival agent-backed ballot measure either. Elizabeth Hammack, who filed that initiative in August, contends that Prop 103 has caused dysfunction for decades.
Her plan would erase the intervenor process entirely, return the commissioner role to an appointed seat, curtail regulatory authority, and block jurisdictional expansion without legislative approval.
Two starkly different paths now head toward California voters: one reinforcing Prop 103 with stricter consumer rights, the other dismantling large parts of it.
The choice could reset the state’s turbulent insurance market for years.
These are among the protections in the Insurance Policyholder Bill of Rights:
- Requires homeowners insurance companies to sell coverage to anyone who fire-proofs their home.
- Prohibits insurers who refuse to sell homeowners insurance from selling car or home insurance policies to Californians for five years.
- Requires insurers to give customers sufficient time to make home repairs and improvements to prevent nonrenewal of policies.
- Requires insurers to publicly report where, when, and why they are cancelling or refusing to renew homeowner policies.
- Requires insurers to give homeowners at least six months notice if not renewing a policy, and disclose specific documented reasons for the nonrenewal. Homeowners must be given a clear explanation of repairs that would qualify them for renewal, the right to repair and appeal, and automatic extensions if delays are due to factors outside of their control.
- Prevents insurance companies for non-renewing or denying coverage because a policyholder inquires about a claim, files a claim the insurer does not pay for any reason, or makes a claim that was not their fault and for which the risk of loss has been removed.
- Requires insurance companies to give homeowners every version of a loss estimate prepared by an adjuster for the insurance company.
In addition, the ballot measures preserves the provisions of insurance reform Proposition 103 – including the prior approval of rates, the independence of the elected insurance commissioner, the ban on the use ZIP-code in auto insurance and other discriminatory factors, and the public participation intervenor system.
