Governor Schwarzenegger recently signed two bills, AB 2199 (Kehoe) and SB 64 (Speier), that were considered part of Insurance Commissioner John Garamendi’s “Homeowners Bill of Rights” package. Garamendi said that the legislation will provide needed protections to California homeowners.
Assembly Bill 2199 prohibits an insurer from starting the clock on any time limit to pay full replacement cost until the first payment toward the actual cash value is made to the policyholder. It also extends the time to rebuild or replace homes to 12 months from the date that the first payment toward the actual cash value is made (24 months in the event of a declared state of emergency). In the event of a total loss, the bill allows homeowners to rebuild their homes in a location other than where the loss occurred. The bill is an urgency measure that was signed by the governor on Aug. 25.
Senate Bill 64 allows homeowners and insurers to mediate disputed homeowner’s insurance claims on a voluntary basis through the California Department of Insurance after a declared state of emergency. The cost of the mediation will be borne by the insurer up to a maximum of $1,500. The legislation is an urgency measure that was signed by the governor on Aug. 30.
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