insurance company

SACRAMENTO — California lawmakers passed laws that would ensure insurance companies provide better coverage for smoke-damaged homes and financing for upgrades protecting residences from future fire damage.

The measures were among a slew of bills approved during the 2026 legislative session to deal with the continuing aftermath of the devastating 2025 Los Angeles area fires.

The Eaton and Palisades fires, which destroyed more than 16,000 structures and killed 31, were two of the deadliest and most destructive fires in state history. Like with catastrophic fires before them, tragedy spurred action.

Much of the focus on wildfire issues by Gov. Gavin Newsom and California lawmakers in the waning days of the legislative session focused on a proposal to shift liability away from utilities whose equipment ignites wildfires.

The complex, high-stakes policy debate attempted to address the needs and financial risks faced by the utilities, their customers and insurance companies following the catastrophic wildfires that have plagued California in recent years, but a proposed compromise recently pieced together by lawmakers and the governor fell through Tuesday.

However, lawmakers did pass several bills this year to help fire victims navigate burdensome insurance requirements in the aftermath of a disaster and increase prevention efforts. All head to Newsom for his consideration.

Two complementary bills approved Monday ensure homes that survive a wildfire but are contaminated by the onslaught of smoke are properly remediated before residents move back in.

The bills were prompted by the 2025 Eaton fire, which left thousands of homes contaminated with lead, some at levels hundreds of times what the U.S. Environmental Protection Agency considers safe. Homeowners routinely reported that their insurance companies refused or delayed claims, advocated for cleaning methods that experts deemed insufficient and pushed residents to move back before testing showed their homes were safe.

The first bill, AB 1642, would direct the Department of Toxic Substances Control to create scientific standards for what constitutes a safe home and provide guidance on how to properly remediate homes. The second, AB 1795, would require insurers to abide by those standards in the claims process and do so in a timely manner.

The companion laws only take effect if Newsom signs both.

The two bills originally conflicted with one another. The scientific standards bill was supported by many Eaton fire survivors from the get-go. However, the insurance bill — born out of a Department of Insurance task force — was widely criticized by survivors for leaving insurance companies wiggle room to deny claims and placing a burden on homeowners to prove their home was in fact contaminated by a fire.

In an eleventh-hour sprint of “sleepless nights,” “five-hour Zooms” and intervention from the governor’s office, advocates won additional protections for fire survivors in the insurance bill and brought the two into harmony, said Dawn Fanning, managing director at the smoke-damaged home advocacy group Eaton Fire Residents United.

“It took a lot of work to get here, and we’re really happy where we landed,” Fanning said.

After the Eaton fire, “it was the Wild West, trying to scramble to find answers,” she said. “If these laws were in place, so many thousands of people would be back home by now.”

Separate legislation by Sen. Benjamin Allen (D-Santa Monica), who is in a hotly contested race for California Insurance Commissioner, seeks to give homeowners more notice and options before being dropped by their insurer, a problem homeowners increasingly face as wildfires have become more frequent and destructive.

Many nonrenewal notices sent by insurance companies include vague reasoning, Allen said during a May hearing on the bill, SB 1301. His legislation would require specific information so property owners can have a chance to mitigate problems and keep their insurance.

Another bill from Allen, who represents the Palisades area that burned in 2025, would create a new loan program to help property owners mitigate fire risks through home hardening, or installing fire-resistant materials on the outside of a structure.

“It can sometimes cost tens of thousands of dollars for homeowners and there’s simply not a lot of financing for this kind of work. There’s not a market for that,” Allen said during an April hearing.

The program is expected to help fund 1,000 projects in its first year and up to 2,400 within five years, according to a bill analysis.

A budget bill approved Tuesday morning also includes $25 million for home hardening grants, rebates or loans to be distributed through a separate program to be created by the Governor’s Office of Emergency Services. It would cap assistance at $25,000 per homeowner or property.

But other proposals to provide financial incentives for home hardening did not pass, including bills by Assemblymember Steve Bennett (D-Ventura) to exclude home hardening upgrades from property tax reassessment and to require insurance companies to provide two quotes to inquiring homeowners: one for the property as is, and another for if it met full home-hardening certification by the state.

Another bill on Newsom’s desk seeks to get restitution for victims of utility-caused wildfires who in some cases have waited more than a decade, said Assemblymember Joe Patterson (R-Rocklin).

In 2019, the state established a wildfire fund paid by utility companies that reimburses claims stemming from wildfires caused by the companies’ equipment. But the fund was not retroactive, and some people who suffered losses before its creation are still waiting to be paid.

Patterson’s bill requires the California Public Utilities Commission to determine how much is still owed to those victims, including for losses from the deadly Camp fire that was sparked by a PG&E power line and destroyed the town of Paradise in 2018.

“For years, wildfire survivors have been forced to wait for answers while restitution shortfalls remain unresolved,” Patterson said in a statement after the bill passed. “AB 2700 is about doing what is right for wildfire survivors who have waited far too long to be made whole.”

In a late-night deal with lawmakers, Gov. Gavin Newsom agreed to drop his push for legislation that would have shifted more of the cost of utility-sparked wildfires to property insurers, sharply raising premiums across the state.

After weeks of closed-door negotiations with lawmakers and protests by wildfire survivors, the governor also backed away from a proposal that reduced amounts fire victims could receive and transferred more of the damage costs to local governments.

Wildfire victims and other critics had called the plan a corporate bailout.

According to a 96-page bill, published at 7:26 a.m. Saturday, Newsom and lawmakers agreed on some measures aimed at reducing the costs of future utility-sparked wildfires.

The bill would limit certain fees of attorneys representing insurance companies, while also stopping hedge funds and private equity firms from profiting on wildfire claims.

Last year, hedge funds were offering to buy claims that insurers had against Southern California Edison for the Eaton fire, leading to calls for reform.

The bill would also create a state program to get payments more quickly to wildfire victims.

“This is all real progress for future fire survivors,” Newsom said in a statement.

“Nonetheless, this system needs full structural reform — not a partial one,” he added. “I urge the Legislature to build on this progress next year and finish the work we started to secure the Wildfire Fund’s long-term durability, stabilize electricity rates, and ensure fire victims are never again turned into unsecured creditors in a bankruptcy proceeding.”

The complex legislation — added by gutting and amending a bill known as Senate Bill 492 — was introduced less than three days before the legislative session was to end Monday.

The session must now be extended until Tuesday because of a 2016 voter-approved proposition that requires bills or amendments to be in print at least 72 hours before the state Senate or Assembly can vote on them.

Eaton wildfire survivors and other groups had been calling on Newsom for weeks to unveil the legislation so that they could see the details.

More than 50 Eaton fire survivors showed up to protest in front of the governor’s mansion on Monday night in Sacramento, where Newsom was holding an event for legislators.

“Who should pay?” they chanted. “Shareholders should pay!”

On Saturday, wildfire victims praised lawmakers who had stood up to the governor’s push for legislation benefiting the utilities.

“Survivors from across California came to Sacramento and asked our elected representatives to stand with the people whose homes, communities and lives have been devastated,” Joy Chen, executive director of Every Fire Survivor’s Network, said. “They listened. And in the face of extraordinary pressure from some of the most powerful interests in our state, they centered on survivors and California families.”

Edison and the state’s two other big for-profit utilities had been lobbying Newsom and lawmakers to further shield them and their shareholders from wildfire liabilities ever since last year’s Eaton fire caused some investors to flee and the price of their stock to tumble.

Government fire investigators said the fire, which killed 19 people and destroyed thousands of homes, was caused by electrical arcing on Edison’s out-of-service transmission line in Eaton Canyon. Edison kept the line in place despite not using it since 1971.

More than 11,000 households have filed suit against the utility, claiming it acted negligently, which the company denies.

Utilities asked Newsom to strengthen a framework that he and lawmakers created in 2019 to protect utilities from bankruptcy after their equipment ignites a catastrophic fire. The law created a $21-billion wildfire fund, which is now reimbursing Edison for the settlements it is making to victims who agree not to sue.

Last year, also in legislation revealed in the session’s last days, Newsom created a second fund of $18 billion to pay for future fires.

According to a confidential document Newsom’s staff sent to lawmakers, the governor also wanted to cap the amount the fund would reimburse a utility for wildfire damages at $6 billion and require electric customers to pay for costs above that amount. That would have limited utilities’ liability for the fire but increased electric bills.

That measure was not in the legislation published Saturday morning.

Newsom said in his statement Saturday that the bill would strengthen accountability for utilities that spark fires by stopping executives from receiving bonuses after a fire.

The fine print in the bill states that the company must have a plan that prevents top executives from receiving “short-term” bonuses after a fire that results in 500 or more structures damaged.

The governor had touted in 2019 that his legislation had tied utility executive pay to the company’s safety performance. But the language allowed the companies to decide how to do that.

Despite the deadly Eaton fire, bonuses awarded to Pedro Pizarro, the chief executive of Edison International and other executives soared last year. Pizarro received $16.6 million in cash, stock and other compensation last year, up 20% from 2024.

The new legislation applies only to Edison, Pacific Gas & Electric and San Diego Gas & Electric. Those three for-profit utilities have caused at least seven of California’s 20 most destructive fires, according to the California Department of Forestry and Fire Protection.

In 2012, on the day after Mark Walter and his partners bought the Dodgers, I sat next to Walter in a conference room. To the sports fan, Walter was virtually anonymous: a super rich guy who had made his money running investment and insurance companies.

Walter’s purchase valued the Dodgers and its related assets at a then-record $2.15 billion. That value stunned the sports world. Mark Cuban had bowed out of the bidding, believing the Dodgers were not worth even $1 billion.

I asked Walter why he believed it made business sense to pay three times as much as any major league team had sold for.

“I think you have a few moments in life where you have the opportunity to own an asset and really be a custodian of something that should be multigenerational and iconic,” he said then. “I understand it’s a lot of money. But it’s not as if you can go buy another one tomorrow. … We hope we never, ever are going to sell it.”

That was essentially the point that someone who travels within the inner circles of pro sports made to me Wednesday morning, as news broke that Walter had sold the Lakers to Bob Iger, the former Disney chief, and Joshua Kushner.

The Steinbrenner family has owned the New York Yankees for 53 years. Jerry Jones has owned the Dallas Cowboys for 37 years. The Buss family owned the Lakers for 46 years.

These trophy assets are few and far between. Walter had agreed to sell the Lakers after less than one year of ownership — and not through a comprehensive bidding process, but to an inquiring caller during the weekend?

“This has more red flags than a May Day parade,” an industry insider said, speaking on condition of anonymity so as not to jeopardize his professional relationships.

The deal, which valued the Lakers at $12.5 billion, was motivated by the spiraling price for an NBA expansion team in Las Vegas, according to ESPN’s Ramona Shelburne. After all, if Iger and Kushner might have to pay $10 billion for a startup team, why not call and see if Walter might accept a bit more for one of the marquee franchises in American sports?

Was this a blind call or was Walter looking to sell?

“It was suggested to us that maybe Mark Walter would be interested in selling his stake in the Lakers,” Iger told the California Post.

What did Dodgers president Stan Kasten have to say about that?

“I never knew that. He never said that to me,” Kasten said. “I think he was surprised by it. That’s what he has expressed to me. Mark had no plan to do this. This just came up, and he thought about it and said yes.”

Why might Walter have been interested in selling?

Mark Walter acknowledges a fan before a game against the Cubs in Chicago this month.

(Melissa Tamez / Associated Press)

Only he can say for sure, but his companies are under federal investigation for failing to disclose and properly account for billions of dollars of loans among related entities. Bloomberg reported Wednesday that Walter’s holding company is trying to raise money that could help pay off or at least pay down those loans, and the Financial Times reported that company assets could be sold or restructured.

No charges have been filed, and investigations can conclude without charges. No allegations of wrongdoing have been made against Walter.

Is there a baseball angle to this?

Among the investment firms Walter’s holding company approached about “deals to raise cash,” according to Bloomberg: the asset management firm owned by New York Mets owner Steve Cohen.

Cohen’s firm passed, according to the Financial Times.

When Walter and his partners bought the Dodgers, the runners-up: the bid team of Cohen and Los Angeles Times owner Patrick Soon-Shiong.

“No, that never came up. And Mark and I discussed it,” Kasten said. “So, no, we don’t have any reason to think that. I certainly have no reason to think that.”

What does Walter’s sale of the Lakers mean for the Dodgers?

“It means nothing for the Dodgers,” someone who speaks regularly with Walter said, speaking on condition of anonymity. “He owned them long before the Lakers and will own them long after.”

If Walter should later sell the Dodgers, what might have the greatest impact on the team?

Shohei Ohtani has an out clause in his contract if Mark Walter sells the team.

(Eric Thayer / Los Angeles Times)

Shohei Ohtani’s 10-year, $700-million contract with the Dodgers includes an unusual escape clause: If Walter is no longer the controlling owner, or if Andrew Friedman is no longer running the Dodgers’ baseball operations department, Ohtani can opt out of the contract.

Would he?

Way too soon to tell. If major league owners get their way in collective bargaining, the proposed salary cap would mean Ohtani at $70 million could eat up just about one-third of any team’s payroll. And, in his third year with the Dodgers, he has yet to complete a full season as a pitcher, and a left knee in which manager Dave Roberts says Ohtani suffers from “wear and tear” could make him less of a two-way player as the contract winds down.

On the other hand, playing salary might be less of an issue for him than for any other player in baseball. Ohtani is making more than his annual salary from sponsorships and endorsements — an estimated $125 million this year — and he famously deferred $68 million of each year’s salary so the Dodgers could spend more freely on players that could help him and the team win. After six losing years with the Angels and two World Series championships in two years with the Dodgers, a losing team might not entice Ohtani, no matter how much room it might have under a proposed cap.

Iger used to run Disney. How did Disney’s experience owning the Angels and Mighty Ducks go?

Disney chairman Michael Eisner, left, NHL commissioner Gary Bettman, NHL chairman Bruce McNall and Mighty Ducks chairman Jack Lindquist blow duck calls announcing the name of the team in 1993.

(Doug Pizac / Associated Press)

Disney dressed the Angels in uniforms derided by one player as “pinstripe pajamas,” put cheerleaders on the dugout roof and installed a loud “countdown to first pitch.” This all seemed awful at the time but, given the plagues of in-game hosts and teams sporting jerseys in colors far beyond home white and road gray, perhaps Disney was just ahead of its time. And, for the first few years of the franchise, Mighty Ducks gear was some of the hottest merchandise in American sports.

Ultimately, Disney wanted the Angels and Mighty Ducks to launch an “ESPN West” regional sports channel. When that channel collapsed, Disney no longer needed the teams and eventually sold them. The Angels were such a minimal part of Disney’s portfolio that then-chief executive Michael Eisner showed up in the clubhouse and the players had no idea who he was.

Who owned the Angels when they won their only World Series championship?

Angels players wave to fans during the World Series title parade in Anaheim in 2002.

(Jean-Marc Bouju / Associated Press)

Disney. The company hired an investment banker to sell the team in the final month before the Angels won the 2002 World Series and agreed to sell to Arte Moreno in the first month of the following season.

One more try: Why did Walter really sell the Lakers?

“I think it was opportunistic and he found something that made sense to him,” Kasten said. “Mark’s a very sensible guy. But that’s really the only way I can explain it.

“You’ll have to talk to Mark about a more in-depth explanation, and good luck.”

Times staff writer Maddie Lee contributed to this report.