Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and generally regulates the business of insurance in the state. Existing regulations prescribe specified deadlines by which an insurer is required to, among other things, respond to a notice of claim, accept or deny a claim, in whole or in part, and, upon acceptance of a claim in whole or in part, tender payment or otherwise take action to perform its obligation, as specified.

This bill, with respect to fire insurance claims arising after January 1, 2027, would codify specified provisions of the regulations prescribing the deadlines above. The bill would also make an insurer that does not comply with the deadlines liable to the insured for interest on the amount of the accepted claim, in whole or in part, at the rate of 20% per year as damages, together with reasonable and necessary attorney’s fees, in addition to the amount the insured is entitled to under the policy.