California 2025-2026 Regular Session

California Assembly Bill AB1339 Latest Draft

Bill / Introduced Version Filed 02/21/2025

CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION Assembly Bill No. 1339Introduced by Assembly Member Mark Gonzlez(Coauthors: Assembly Members Jackson and Kalra)February 21, 2025 An act to add and repeal Chapter 6 (commencing with Section 13850) of Division 3 of the Insurance Code, relating to insurance. LEGISLATIVE COUNSEL'S DIGESTAB 1339, as introduced, Mark Gonzlez. Department of Insurance: housing insurance study.Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and prescribes the departments powers and duties. Existing law generally regulates classes of insurance.This bill would require the department, upon appropriation and in consultation with specified entities and affordable housing entities, to conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities, as defined, that receive a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee. The bill would require an insurer to provide necessary information requested by the commissioner for the study. The bill would require the department, in conducting the study, to, among other things, (1) collect information from relevant entities, (2) obtain data on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts, and (3) analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for specified affordable housing entities. The bill would also require the department to analyze how, if at all, insurers consider specified determinations of offers or rate setting, including the level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured. The bill would require the department to submit a report on the study to the appropriate committees of the Legislature by December 31, 2026. The bill would require that report to make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for specified affordable housing entities as identified in the study. The bill would repeal these provisions as of January 1, 2027.The bill would also make related findings and declarations.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Chapter 6 (commencing with Section 13850) is added to Division 3 of the Insurance Code, to read: CHAPTER 6. Affordable Housing Insurance Coverage Study13850. The Legislature finds and declares all of the following:(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012. (c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance. (d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California. 13851. (a) (1) The Department of Insurance shall conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities as defined in Section 13907 and receiving a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee intended to serve lower income households, as defined in Section 50079.5 of the Health and Safety Code. The department shall additionally identify barriers to keeping these affordable housing entities appropriately insured. (2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies. 13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following: (a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department. (b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts. (c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026. (b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study. (c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code. 13854. Implementation of this chapter is contingent upon an appropriation by the Legislature for purposes of this chapter in the annual Budget Act or another statute.13855. This chapter shall remain in effect only until January 1, 2027, and as of that date is repealed.

CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION

Assembly Bill

No. 1339

Introduced by Assembly Member Mark Gonzlez(Coauthors: Assembly Members Jackson and Kalra)February 21, 2025

Introduced by Assembly Member Mark Gonzlez(Coauthors: Assembly Members Jackson and Kalra)
February 21, 2025

An act to add and repeal Chapter 6 (commencing with Section 13850) of Division 3 of the Insurance Code, relating to insurance.

LEGISLATIVE COUNSEL'S DIGEST

## LEGISLATIVE COUNSEL'S DIGEST

AB 1339, as introduced, Mark Gonzlez. Department of Insurance: housing insurance study.

Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and prescribes the departments powers and duties. Existing law generally regulates classes of insurance.This bill would require the department, upon appropriation and in consultation with specified entities and affordable housing entities, to conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities, as defined, that receive a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee. The bill would require an insurer to provide necessary information requested by the commissioner for the study. The bill would require the department, in conducting the study, to, among other things, (1) collect information from relevant entities, (2) obtain data on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts, and (3) analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for specified affordable housing entities. The bill would also require the department to analyze how, if at all, insurers consider specified determinations of offers or rate setting, including the level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured. The bill would require the department to submit a report on the study to the appropriate committees of the Legislature by December 31, 2026. The bill would require that report to make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for specified affordable housing entities as identified in the study. The bill would repeal these provisions as of January 1, 2027.The bill would also make related findings and declarations.

Existing law creates the Department of Insurance, headed by the Insurance Commissioner, and prescribes the departments powers and duties. Existing law generally regulates classes of insurance.

This bill would require the department, upon appropriation and in consultation with specified entities and affordable housing entities, to conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities, as defined, that receive a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee. The bill would require an insurer to provide necessary information requested by the commissioner for the study. The bill would require the department, in conducting the study, to, among other things, (1) collect information from relevant entities, (2) obtain data on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts, and (3) analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for specified affordable housing entities. The bill would also require the department to analyze how, if at all, insurers consider specified determinations of offers or rate setting, including the level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured. The bill would require the department to submit a report on the study to the appropriate committees of the Legislature by December 31, 2026. The bill would require that report to make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for specified affordable housing entities as identified in the study. The bill would repeal these provisions as of January 1, 2027.

The bill would also make related findings and declarations.

## Digest Key

## Bill Text

The people of the State of California do enact as follows:SECTION 1. Chapter 6 (commencing with Section 13850) is added to Division 3 of the Insurance Code, to read: CHAPTER 6. Affordable Housing Insurance Coverage Study13850. The Legislature finds and declares all of the following:(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012. (c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance. (d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California. 13851. (a) (1) The Department of Insurance shall conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities as defined in Section 13907 and receiving a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee intended to serve lower income households, as defined in Section 50079.5 of the Health and Safety Code. The department shall additionally identify barriers to keeping these affordable housing entities appropriately insured. (2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies. 13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following: (a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department. (b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts. (c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026. (b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study. (c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code. 13854. Implementation of this chapter is contingent upon an appropriation by the Legislature for purposes of this chapter in the annual Budget Act or another statute.13855. This chapter shall remain in effect only until January 1, 2027, and as of that date is repealed.

The people of the State of California do enact as follows:

## The people of the State of California do enact as follows:

SECTION 1. Chapter 6 (commencing with Section 13850) is added to Division 3 of the Insurance Code, to read: CHAPTER 6. Affordable Housing Insurance Coverage Study13850. The Legislature finds and declares all of the following:(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012. (c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance. (d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California. 13851. (a) (1) The Department of Insurance shall conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities as defined in Section 13907 and receiving a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee intended to serve lower income households, as defined in Section 50079.5 of the Health and Safety Code. The department shall additionally identify barriers to keeping these affordable housing entities appropriately insured. (2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies. 13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following: (a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department. (b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts. (c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026. (b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study. (c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code. 13854. Implementation of this chapter is contingent upon an appropriation by the Legislature for purposes of this chapter in the annual Budget Act or another statute.13855. This chapter shall remain in effect only until January 1, 2027, and as of that date is repealed.

SECTION 1. Chapter 6 (commencing with Section 13850) is added to Division 3 of the Insurance Code, to read:

### SECTION 1.

CHAPTER 6. Affordable Housing Insurance Coverage Study13850. The Legislature finds and declares all of the following:(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012. (c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance. (d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California. 13851. (a) (1) The Department of Insurance shall conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities as defined in Section 13907 and receiving a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee intended to serve lower income households, as defined in Section 50079.5 of the Health and Safety Code. The department shall additionally identify barriers to keeping these affordable housing entities appropriately insured. (2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies. 13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following: (a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department. (b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts. (c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026. (b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study. (c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code. 13854. Implementation of this chapter is contingent upon an appropriation by the Legislature for purposes of this chapter in the annual Budget Act or another statute.13855. This chapter shall remain in effect only until January 1, 2027, and as of that date is repealed.

CHAPTER 6. Affordable Housing Insurance Coverage Study

13850. The Legislature finds and declares all of the following:(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012. (c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance. (d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California.

13850. The Legislature finds and declares all of the following:

(a) Hundreds of thousands of affordable homes have been built across California to meet the needs of low-income households and people experiencing homelessness. The state has invested billions of dollars in these homes through programs administered by the Department of Housing and Community Development and the California Tax Credit Allocation Committee.

(b) The United States is facing an industrywide insurance crisis, especially in the property insurance sector. According to Marshs Global Insurance Market Index, property insurance rates have increased for 27 consecutive quarters, continuing the longest run of increases since the inception of the index in 2012.

(c) Affordable housing entities in urban, suburban, and rural communities across California are facing limited availability of insurance coverage, significant premium and deductible cost increases, and reductions in the scope and quality of coverage. These issues are present in property, liability, and builders risk insurance.

(d) Affordable housing entities have limited options to manage increased insurance costs due to their mission and legal requirements to keep rents at affordable levels for low-income households. As a result, affordable housing entities are particularly vulnerable to insurance cost increases, which now present an urgent threat to the fiscal solvency and stability of affordable housing across California.

13851. (a) (1) The Department of Insurance shall conduct a study of the property, liability, and builders risk insurance coverages available to affordable housing entities as defined in Section 13907 and receiving a grant, loan, or tax credit awarded by the Department of Housing and Community Development or the California Tax Credit Allocation Committee intended to serve lower income households, as defined in Section 50079.5 of the Health and Safety Code. The department shall additionally identify barriers to keeping these affordable housing entities appropriately insured. (2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee. (b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies.

(2) The department shall conduct this study in consultation with the affordable housing entities described in paragraph (1), admitted and nonadmitted insurers, providers of nonprofit insurance services, risk-sharing pools for public housing authorities and nongovernmental owners of affordable housing properties, insurance captives, risk retention groups, and other relevant state agencies, including the Department of Housing and Community Development and the California Tax Credit Allocation Committee.

(b) An insurer, upon the request of the commissioner, shall provide and make available any information necessary to comply with the requirements of this section. Any information provided to the department by an insurer shall be considered a trade secret, confidential, privileged, or otherwise exempt from disclosure under the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code). Nothing in this section prohibits the commissioner from preparing and publishing reports, analyses, or other documents using the data received under this section so long as the data is in aggregate form and does not permit the identification of information related to individual companies.

13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following: (a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department. (b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts. (c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851. (e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.

13852. In conducting the study described in subdivision (a) of Section 13851, the department shall do all of the following:

(a) Collect information necessary to conduct the study from relevant insurers with the affordable housing entities described in subdivision (a) of Section 13851. Identified admitted and nonadmitted insurers, insurance captives, and risk retention groups shall provide the requested information to the department.

(b) Obtain data from the previous five years on the number and types of insurance policies in effect, reasons for policy nonrenewals or cancellations, claims activity, and premium and deductible amounts.

(c) Analyze and request any other relevant information that may help the department analyze the availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851.

(d) Analyze trends impacting market availability of property, liability, and builders risk insurance coverage for the affordable housing entities described in subdivision (a) of Section 13851.

(e) (1) Analyze and request any other relevant information that may help the department analyze how, if at all, insurers consider the following in determinations of insurance policy offers or rate setting:

(A) The level or source of income of an individual or group of individuals residing or intending to reside upon the property to be insured, if the individual or group of individuals is not the owner of the real property.

(B) The receipt of assistance, intended for housing, from the federal or state government, or from a local public entity, as defined in Section 50079 of the Health and Safety Code, including, but not limited to, federal vouchers issued under Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 1437f), by an individual or group of individuals residing or intending to reside upon the property insured or to be insured.

(2) The designation of real property containing a residential dwelling unit as affordable to residents at a specific income level pursuant to statute, regulations, or restrictive declaration, or pursuant to a regulatory agreement with a state governmental entity.

13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026. (b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study. (c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code.

13853. (a) The department shall submit a report on the study described in subdivision (a) of Section 13851 to the appropriate committees of the Legislature on or before December 31, 2026.

(b) The report shall make recommendations on potential policy and budget options to address insurance coverage cost and access challenges for the affordable housing entities described in subdivision (a) of Section 13851, as identified in the study.

(c) The report submitted to the Legislature pursuant to this section shall be submitted pursuant to Section 9795 of the Government Code.

13854. Implementation of this chapter is contingent upon an appropriation by the Legislature for purposes of this chapter in the annual Budget Act or another statute.

13855. This chapter shall remain in effect only until January 1, 2027, and as of that date is repealed.