Insurance company executives warned Gov. Gavin Newsom in a letter Wednesday that his plan to shift utility wildfire liability to property insurers would raise premiums across California.<\/p>\n
\u201cThe party whose equipment ignites a catastrophic fire should bear the economic consequence of that fire,\u201d the 15 executives wrote. \u201cShifting those costs to policyholders does not reduce the cost of electricity but does make homeownership more expensive and insurance coverage harder to find.\u201d<\/p>\n
As the legislative session nears its end, Newsom\u2019s staff and lawmakers have been negotiating behind closed doors on a deal to limit utilities\u2019 wildfire liabilities<\/a>.<\/p>\n According to a confidential document that Newsom\u2019s staff sent to lawmakers and was obtained by Politico, the governor wants to stop property insurers from recouping their losses from homes destroyed in utility-sparked wildfires.<\/p>\n That could increase homeowners\u2019 property insurance rates by as much as 50%, according to the Personal Insurance Federation of California. The highest hikes would be for those families living in severe fire risk areas.<\/p>\n \u201cThe proposal would shift billions of dollars in wildfire costs away from utilities and onto insurance consumers across the state, making coverage more expensive and harder to find,\u201d said Denni Ritter at the American Property Casualty Insurance Assn.<\/p>\n Southern California Edison and the state\u2019s two other big for-profit utilities have been lobbying Newsom<\/a> and lawmakers to further shield them and their shareholders from wildfire liabilities ever since last year\u2019s Eaton fire caused the price of their stock to tumble.<\/p>\n Government fire investigators said the fire, which killed 19 people and destroyed thousands of homes, was caused by electrical arcing<\/a> on Edison\u2019s out-of-service transmission line in Eaton Canyon. Edison kept the line in place despite not using it since 1971.<\/p>\n More than 11,000 households have filed suit against the utility, claiming it acted negligently, which the company denies.<\/p>\n