Bill To Expand Last Resort Insurance Coverage To Farms Passes Senate Unanimously

A bill that would allow farms in California to be covered by last resort insurance to protect them from natural disasters such as wildfires passed the Senate unanimously on Thursday, sending the bill directly to Governor Newsom’s desk.

Senate Bill 11, authored by Senator Susan Rubio (D-Baldwin Park), would change the inclusions and exclusions of California’s Fair Access to Insurance Requirements (FAIR) Association, an insurance system in California set up to allow people to get property insurance who are otherwise unable to through normal channels. SB 11 would remove automobile risks, commercial agricultural commodities or livestock, or equipment used to cultivate or transport agricultural commodities or livestock exclusions from the FAIR definition of “basic property insurance” and would instead have the FAIR Association file a new or amended rate application with the Insurance Commissioner. No insurance premiums would also be given to the changed areas of classification.

Due to the bill being amended last month as an emergency statute, SB 11 would take place immediately. Under the bill, farms without property insurance would be able to get it through FAIR in time for wildfire season.

Senator Rubio wrote the bill due to many insurance companies cancelling or not-renewing current property insurance agreements, and refusing to grant new coverage to farms due to the high wildfire risk many farms now pose. According to the Senator, by allowing them to be bought through FAIR, farms across the state would rebound back quicker and would protect many from closing by legally giving them an insurance option through the Department of Insurance.

“In order for California to remain the breadbasket of the world, we have to support and protect our farms in the face of devastating wildfires,” Senator Rubio said Thursday. “With SB 11, thousands of farmers will be helped by allowing them to obtain coverage through the FAIR Plan. I want to thank my colleagues for their unanimous, bipartisan support. Without insurance, farmers cannot access loans to update equipment, plant their crop, or pay workers, putting their farm at risk of closing. Ensuring farmers can access the FAIR Plan for coverage like any other business is a critical step.”

SB 11 unanimously passed by Assembly, Senate

Unlike many agricultural bills that have been put up for a legislative fight this session, SB 11 has received bipartisan support. On July 1st, the Assembly passed the bill 77-0, followed quickly by the Senate passing it 39-0 on Thursday due to the urgency clause.

“Both parties are definitely in support of more wildfire protections, especially after the Camp Fire a few years back in Paradise,” former farming lobbyist Helen Fox told the Globe on Friday. “A lot of farms are in both red and blue districts. Look at a map where farms are at in Northern California and the Central Valley, and you can see why this is a bipartisan issue. With insurance companies not wanting to take this wildfire kind of risk, an option was needed, and that’s where SB 11 came in.”

“Basically everyone saw the need to protect farms and property in general, and now the rush is on to get a lot of these dropped farms insurance again before wildfire season really hits hard.”

Many agricultural groups, including the California Farm Bureau Federation, praised passage of the bill on Thursday, noting the benefits that SB 11 would give both farms and rural communities alike. They also urged Governor Gavin Newsom to sign the bill as soon as possible due to the urgent need of insurance on farms across the state.