A bipartisan bill introduced in the U.S. Senate proposes a national review of how wildfires affect property insurance pricing and availability.
The Wildfire Insurance Coverage Study Act aims to identify strategies that reduce financial exposure for homeowners and insurers.
This bill requires reports regarding wildfire risk and damage. Specifically, the Government Accountability Office (GAO) must report on trends in wildfire declarations, mitigation practices, state and federal programs regarding wildfire risk, and the need for a national map of wildfire risks.
The GAO must also report on
- the availability and cost of wildfire insurance coverage for homes and commercial property
- state regulatory responses to increasing costs of coverage
- impediments to private wildfire insurance coverage.
The legislation mandates a federal assessment of rising wildfire threats, current insurance coverage gaps, and insurer behavior—especially policy non-renewals tied to geographic risk. It also calls for a nationwide wildfire risk map and an evaluation of regulatory responses across states.
Senators Tim Sheehy (R-MT) and Martin Heinrich (D-NM) jointly introduced the measure.
If families can’t obtain or afford coverage, they can’t finance homes. That blocks access to homeownership for working Americans.
Senator Tim Sheehy
In 2023, Heinrich, then chair of the Joint Economic Committee, released findings underscoring the unpredictability of wildfire risk.
Causes vary widely, and homes face complex exposure profiles. These uncertainties have prompted insurers to either significantly raise premiums in the West or exit those markets altogether.
We need better data to understand how climate-related fire risks are shaping insurer decisions. Without it, there’s little recourse when premiums spike or coverage disappears.
Senator Martin Heinrich
However, the National Association of Mutual Insurance Companies (NAMIC) expressed skepticism about the usefulness of another federal study.
“Consumers don’t benefit from more reports confirming what’s already clear—that wildfire risk is escalating,” said Jimi Grande, NAMIC’s senior VP of federal and political affairs.
He stated that risk-based pricing reflects actual exposure, especially as more policyholders move into high-risk zones. According to Grande, mitigation—not more research—is the priority.
“Land-use reform, stronger community-level resilience measures, and improved construction standards offer practical ways to limit fire damage. That’s how we ensure insurance remains both available and affordable,” he said.
Wildfire Insurance Coverage Study Act
On January 16, 2025, Representative Maxine Waters, joined by Representative Brad Sherman, introduced the Wildfire Insurance Coverage Study Act of 2025 in the U.S. House of Representatives.
The bill, referred to the Committee on Financial Services, instructs the Government Accountability Office (GAO) to conduct a comprehensive study on the state of insurance coverage for wildfire damage in the United States.
The goal is to provide lawmakers with a detailed understanding of the challenges related to underwriting, availability, affordability, and regulatory response surrounding wildfire risk.
The GAO, in coordination with the Federal Insurance Office and state regulators, must assess both the scale and nature of wildfire risk, including frequency, geography, and costs associated with federal disaster declarations.
The study must also evaluate existing risk mitigation programs and the effectiveness of forecasting systems. It will explore whether a national wildfire risk map is needed to better inform public policy and industry practices.
Further, the report will examine how private insurers have responded over the past decade, particularly regarding rate adjustments, policy non-renewals, and exclusions for wildfire coverage.
It will also review the conditions insurers impose when continuing to offer wildfire coverage, such as property hardening and vegetation management.
The bill mandates analysis of how state regulators have addressed rising premiums and reduced access to coverage.
This includes rate moratoriums, mandated coverage, state-run insurance entities, and other localized mitigation strategies. In parallel, the GAO must investigate underwriting difficulties, including insurers’ solvency concerns, risk concentration, and housing development in high-risk zones.
The study also considers the wider social and economic impact, particularly on low-income communities, small businesses, and post-fire reconstruction efforts.
The GAO must submit its findings to Congress within 12 months of the Act’s enactment, providing a foundation for potential federal and state policy adjustments aimed at stabilizing the wildfire insurance market.
