Journal of Science Policy & Governance
​Volume 20, Issue 01 | March 28, 2022

Op-Ed: The Need to Modernize California Wildfire Insurance Regulation with Climate Science

Anisha G. Singh
Stanford University, Applied Physics, Stanford, CA

​Corresponding author: agsingh@stanford.edu
Keywords: wildfires; insurance regulation; climate science modeling ​
https://doi.org/10.38126/JSPG200108

Executive Summary

Recent fire seasons have been the worst in California’s modern history. Beyond causing unprecedented damage to property and loss of life, the California wildfire crisis has also exposed serious issues within the state’s home insurance market. State regulation prevents insurers from incorporating the projected climate change-driven increases in wildfire, in policy pricing. Unable to adequately price for wildfire risk, many insurance companies have withdrawn from wildfire-prone areas. Meanwhile, companies that concentrated their policies in these areas have gone insolvent, as they failed to diversify their wildlife risk. Lack of access to reliable insurance leaves many homeowners vulnerable to significant financial losses. To ensure a healthy insurance market that is resilient to climate change-driven disaster, California legislators should revise the insurance code to authorize the use of 1) catastrophic modeling and reinsurance costs and 2) modern climate data and forecasting techniques to rate set for wildfire risk. However, adoption of these new methodologies for rate setting must be accompanied with independent oversight to protect consumers and responsibly regulate new science-based policies. ​

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Background header image courtesy of US Air Force from Flickr
Anisha Singh is a PhD candidate in Applied Physics and is pursuing a graduate certificate in policy analysis at Stanford University. Anisha researches materials with unusual properties that could be used to create faster and more efficient electronics. She received her BA in physics from U.C. Berkeley and previously worked at Lawrence Berkeley National Lab. Anisha is interested in how policy shapes the scientific research environment in the US and impacts participation in our scientific workforce. In the future, Anisha hopes to contribute to federal policy to expand representation in our scientific workforce and promote the open access of scientific information

Acknowledgements
The author would like to acknowledge Luke Merrick for helpful feedback on earlier versions of this manuscript.

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