Idaho, Colorado, New Mexico take on wildfire insurance issues

January 28, 2025 3:42 PM

Smoke filled sky over roller coasters at Magic Mountain amusement park — A plume of smoke from the Hughes Fire seen from near the Six Flags Magic Mountain amusement park in Valencia, California on Jan. 22, 2025.

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California's insurance crisis, worsened by the L.A. wildfires, and its legislature's new catastrophe bonds proposal is leading governments of other states with fire risks to propose their own insurance funds and other measures.

In a related development at the U.S. federal level, freshman congressman Troy Downing of Montana's 2nd district, introduced a bill calling for the elimination of the Federal Insurance Office (FIO), the unit of the U.S. Treasury created by the Dodd-Frank Act in 2010 to monitor the insurance industry. FIO is supposed to receive home insurance market data collected by state regulators last year. Downing was previously state auditor for Montana, where he also advocated for closing FIO.

Here's a roundup of bills and other actions at the state level concerning wildfires, climate risks and related actions impacting the insurance market.

Idaho

Idaho House Bill 17, introduced January 16, states its purpose is to address insurers across the country that are contracting or withdrawing from certain areas due to the risk of wildfire. The bill would improve and stabilize the insurance market by starting an Idaho Wildfire Risk Mitigation and Stabilization Pool and board.

Colorado

State assembly representative Brianna Titone, replying to email, said she and a co-sponsor, Rep. Kyle Brown, plan to introduce two bills mandating that insurance models better account for wildfire mitigation by homeowners, communities and the state of Colorado.

Colorado Governor Jared Polis signed a law in May 2023 creating a FAIR (Fair Access to Insurance Requirements) plan to cover homeowners who cannot otherwise get insurance.

Texas

On January 16, the state fire marshall's office issued a video reminding residents that the state's Public Protection Classification (PPC) for cities' and towns' fire protection capabilities can affect home insurance rates. The state's Insurance Services Office administers PPC ratings.

Minnesota

Hailstorms have been a weather risk problem in the state. In 2023, the state's Department of Commerce announced plans for a Strength in Minnesota Homes program that would provide $10,000 grants for homeowners to fortify their homes against hail.

The commerce department's last update on the program, in August, said no launch date is available yet.