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Committee advances bill to require automatic payments for FAIR Plan; insurer of last resort raises concerns
Summary
The committee passed AB 290 as amended to Appropriations. The bill would require the California FAIR Plan to offer automatic payment and add a grace period for some nonrenewals. The FAIR Plan said the April 1, 2026 implementation date is too aggressive and asked to remove the nonrenewal grace period and extend the timeline.
The Assembly Insurance Committee voted to pass AB 290, sending the measure to the Assembly Appropriations Committee. The bill, authored by Assemblymember Bauer Kahan, would require the California FAIR Plan (the insurer of last resort) to implement automatic payment options for policyholders and would add a grace period provision for certain nonrenewals.
Assemblymember Rebecca Bauer Kahan described her experience being nonrenewed and then relying on the FAIR Plan. She told the committee her premium increased from “under $3,000 a year to $9,000 a year,” and said some FAIR Plan policyholders have been dropped after missing an online acknowledgement, which in turn caused further premium increases. “My insurance went up 300%. I went up from under $3,000 a year to $9,000 a year,” Bauer Kahan said, explaining the motivation for the bill.
Supporters included Robert Harel of the Consumer Federation of California and housing advocates who emphasized the FAIR Plan holds hundreds of thousands of policies and that automation is basic customer service for households that lack other options.
Ovev Franco, representing the California FAIR Plan, said the FAIR Plan appreciates the author’s office and committee amendments but must remain opposed to the bill as amended. Franco told the committee that the bill “requires the fair plan to implement automatic payments by 04/01/2026,” and that the FAIR Plan is concerned that timeline is too aggressive given current operational demands: processing claims from recent catastrophic wildfires, implementing the Safer from Wildfires discount program, and expanding certain commercial policy limits. Franco said the FAIR Plan requested removing the grace period provision for nonrenewals and asked for a later implementation date.
Committee members from both urban and rural districts expressed strong support for requiring automatic payments and adding a grace period, calling the lack of autopay “frustrating” and arguing it harms consumers. Several members asked to be added as coauthors; the author indicated acceptance of amendments and asked for an aye vote.
The committee recorded the motion as “do pass as amended” and referred AB 290 to the Assembly Appropriations Committee. The secretary called the roll and recorded the committee’s vote.
