As you will read in this month’s newsletter, our advocacy work continues both in California and in D.C.
Thankfully, our teams at IIABCal and Big I have the experience and influence to represent our industry’s interests well.
In fact, they have a long history of doing just that:
Big I has been lobbying for our industry’s interests at the Federal level for over 100 years, and Big I CEO Charles Symington has been named as a “Top Lobbyist” in D.C. many times.
Our Federal PAC, InsurPac, raises and distributes approximately $2.4 million each election cycle, making it one of the largest small business PACs in the country.
InsurPac raises and distributes approximately $2.4 million each election cycle, making it one of the largest small business PACs in the country.
Our own IIABCal lobbyists, Steve Young and John Norwood, have over 70 years of combined experience advocating on the state level.
Our Independent Insurance Political Action Committee (IIPAC) turns 55 years old this year! IIPAC has been a steadfast advocate for the issues that matter most to our industry and future. Join us as we build on 55 years of impact. Please support IIPAC today with a donation of $55and be part of the movement that shapes tomorrow!
I am excited to represent IIABCal at the upcoming Big I Legislative Conference in Washington, D.C. Our California delegation of nearly a dozen IIABCal members and staff will be briefed by the Big I lobbyists and then we will meet with various California elected officials to lobby on the Property Insurance Market Crisis, Tax Reform, Disaster Mitigation, Legal Reform and Crop Insurance. This grassroots advocacy empowers our collective voice and can lead to meaningful policy changes that strengthen our industry and communities. If you would like to join us in D.C. on April 28-May 2, register by April 11. Visit the dedicated Big I Legislative Conference webpage to learn more.
CEO Corner
April Showers Bring May Hawaiian Flowers
We are in the final stages of planning for the May 4-8 Blue Ribbon Conference on the Big Island of Hawaii. We already have more first-time attendee agents than ever before and a slew of premier carriers and vendors as sponsors! We have scheduled great educational sessions on reinsurance, AI, leadership, and a special panel with some of our favorite carrier executives. “Shades of the Sea Soiree” is our new theme for the closing party, where attendees will be dressed in the favorite ocean hues! It’s not too late to join us! Register now at IIABCalBlueRibbon.org
Jill Epstein
CEO
IIABCal
IIABCal Advocacy
IIABCal Fighting Efforts to Let Insurers Poach Brokers’ FAIR Plan Customers
Other than policyholders, insurance agents and brokers have suffered the most from the current crisis in the availability of property insurance. For the last four years, independent agents and brokers have endured almost a complete suspension of the voluntary market for property insurance, had their agency appointments terminated, had restrictions imposed on submitting new applications for coverage, lost longtime clients to other markets and had commissions reduced. Now, just as the insurance commissioner’s reforms begin to take effect, some insurers are lobbying the Legislature to let them take brokers’ policyholders without compensation–by changing the law to allow them to market directly to policyholders in the FAIR Plan.
California law requires the Plan to establish a clearinghouse “take out” program designed to allow an insurance company to remove risks from the FAIR Plan. IIABCal successfully lobbied to include provisions in the law that require any insurer that wants to use the “take out” program to do so only through the broker of record. This was, and is, a critical protection for brokers to protect their agencies, hard work and book of business. No producer voluntarily places their client in the FAIR Plan. The explosive growth of the California FAIR Plan is a result of a dysfunctional regulatory system and extreme delays in rate approvals which has resulted in carriers bailing out of the market, not the fault of insurance producers.
AB 69 requires producers to try to move risks they have in the FAIR Plan to the voluntary market upon renewal. The bill is supported by IIABCal because we understand that producers want to move the business if at all possible. The bill passed the Assembly Insurance Committee this week and will be moving to a full vote on the Assembly Floor in a few weeks. However, IIABCal will be keeping a close eye on the bill and any other legislative or regulatory actions that might be utilized to expose an agency’s or producer’s clients in the FAIR Plan to marketing efforts that would threaten producers’ property rights.
Lara Approves Increased FAIR Plan Commercial Coverage Limits
California Insurance Commissioner Ricardo Lara has approved a FAIR Plan filing to increase commercial property coverage limits from $20 million per location to $20 million per building, with a new aggregate limit of $100 million per location.
The FAIR Plan must make these new coverage limits available to all eligible applicants for both new and renewal policies within 120 days from March 28, the date of the Commissioner’s approval, as set forth in CDI Order No. 2024-2.
“This targeted FAIR Plan expansion helps meet the urgent needs of homeowners associations, affordable housing developers, farmers, builders, and business owners who are being priced out or left without coverage altogether,” Lara said in a press release. “It is a short-term solution with long-term benefits—providing necessary insurance access while we continue implementing comprehensive reforms to restore a competitive and reliable market in California.”
The higher coverage limit for commercial properties is intended to be temporary, for three years only. After that time, commercial policy limits will revert to $20 million per location—unless the program is extended or otherwise modified by the Commissioner or his successor.
The Commissioner’s order met with strong approval of several organizations and business groups that have been hardest hit by the availability crisis, citing the benefits of a more predictable and reliable insurance marketplace.
The Building Industries Association and the Farm Bureau have been members of an informal coalition of industries formed by IIABCal, including realtors and mortgage lenders, that have been instrumental in pressing the need for insurance regulatory reform.
Question of the Month
Editor’s Note: Do you have a question about California law? Your answer may already be posted on the IIABCal website. We maintain a large repository of questions posed by members on a wide variety of California regulatory and other legal requirements. They are available free of charge to all members at “California Agent Question of the Month”. From the home page, go to “Member Benefits”, then “Ask an Expert”, and then “California Agent Question of the Month”.
Here is a recent sample. The answer is provided for general informational purposes only, and is NOT intended, and should not be relied upon, as legal advice for any particular situation or problem. This month’s question was answered by Margeaux Pelusi, a senior associate at Hirschfeld Kraemer LLP, a prominent labor and employment law firm based in San Francisco.
Question
Must employers fully reimburse all cell phone and home
office internet expenses?
Are we required to reimburse 100% of employee expenses for cell phone and home office internet charges where employees use both for work, as well as personal, communications?
Answer
As with most areas of California employment law, the answer here isn’t straightforward.
As a general rule, employers are required to reimburse business expenses incurred by their employees. California Labor Code Section 2802 states: “An employer shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties, or of his or her obedience to the directions of the employer, even though unlawful, unless the employee, at the time of obeying the directions, believed them to be unlawful.”
For cell phone reimbursement, the law requires an employer to provide reimbursement for some “reasonable percentage” of the bill, based on usage.
For home internet, it depends on whether the employee is working from home by choice (for convenience) or because it is truly a remote position and there is no physical office space. In the former, reimbursement likely is not required. In the latter, reimbursement for a reasonable portion of the cost is required.
For more advice on these and other areas of California employment law, please contact Margeaux Pelusi at mpelusi@hkemploymentlaw.com. IIABCal Members who retain Hirschfeld Kraemer for advice and counseling work will receive a heavily discounted hourly rate of $475.
Risk Theory is a specialty insurance provider dedicated to delivering innovative and tailored risk solutions across various markets. With a deep understanding of industry-specific challenges, they partner with independent agents and brokers to provide unique coverage options that meet the evolving needs of their clients.
Their expertise spans across commercial auto, dealerships, specialty property (i.e., multi-family property, high-value homeowner property, syndicated property, etc.), professional lines, and niche markets where customized underwriting and claims management make a significant impact.
Risk Theory is committed to driving growth, mitigating risk, and ensuring the long-term success of partners through superior underwriting, exceptional service, and cutting-edge technology. Their vision is to be the trusted advisor of choice for independent agents and producers, offering market-leading insurance solutions that set new industry standards.
David Choi, Senior VP at Risk Theory, adds, “We are excited to enter new markets and build meaningful relationships with IIABCal’s independent agent members, ensuring they have the tools and support needed to thrive in an evolving industry.”
IIABCal Supports Travelers Institute Event on Workers’ Mental Health
On Tuesday, May 13, join the Travelers Institute for “Creating Your Action Plan: Prioritizing Worker Mental Health” at The Bridges Golf Club in San Ramon. The FREE session will take place from 11:30 am-1:30 pm PT and will focus on your organization’s approach to employee mental health and well-being. Speakers will share their perspectives on how organizations can proactively work to understand what resources are needed within their organizations to address mental health and how best to connect employees to those resources.
Product recalls and contamination incidents are rising across industries, leading to devastating financial and reputational consequences. Now more than ever, businesses need strong coverage to safeguard their operations.
As a valued member, you have exclusive access to CRC’s specialized Product Contamination Insurance Program—designed to provide comprehensive protection in an evolving risk landscape. Plus, members receive 1.0% higher commission than non-members on policies written through this program.
Why CRC’s Product Contamination Insurance?
Covers first-party recall expenses & business interruption
Includes crisis management services to protect brand reputation
Thank you to Monarch for so many years of support and to all the sponsors, exhibitors and attendees for I-Day 2025! We hope to see you at I-Day 2026! Congratulations to the winner of the free booth – Zenith Insurance Company.
Save the date for the Summer Luncheon – June 4th at SOL Cantina – registration details coming soon.
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