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Picking the next insurance commissioner could be one of the most important decisions Californians make for their wallets this election year.
They may have seen a big increase in their insurance premiums in the past couple of years. They might know someone whose homeowners policy got canceled. Or perhaps they’re trying to rebuild after last year’s deadly Los Angeles County fires.
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If you’re not sure what the insurance commissioner does, here’s a rundown:
- Regulates the nation’s largest property and casualty insurance market, which includes policies for homeowners, businesses, landlords, renters and drivers.
- Leads the Insurance Department, which reviews and approves premium rate increases.
- Regulates life, health and workers’ compensation insurance.
Whoever is elected to succeed Commissioner Ricardo Lara will have a long to-do list. For the past few years, insurance companies have paused writing homeowner policies or reduced their presence in California. That’s starting to change because of industry-friendly regulations Lara put in place, but premiums are still rising and the market cannot be described as healthy yet.
The L.A.-area fires last year highlighted other problems, such as homeowners dealing with insurers delaying or denying claims, discovering they were underinsured, or finding out there are no standards for smoke-damage claims. Frustrated fire survivors called for Lara to step down.
In a recent poll commissioned by the Insurance Fairness Project, a national insurance information hub, 62% of likely voters said they are very concerned about the cost of home insurance and 43% said they are not confident at all that California’s insurance system can withstand future extreme weather disasters.
Former insurance commissioner John Garamendi, who held the position two separate times and is now a U.S. congressmember, calls the commissioner job the second-hardest in the state behind the governor. Another former commissioner, Dave Jones, said the next commissioner needs to keep a closer eye on insurance companies and regularly examine their conduct, creating “clear enforcement triggers.” He worked on a blueprint with recommendations galore for Lara’s successor.
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