California Wildfire Insurance Changes in 2026: What Los Angeles Property Owners Need to Know

Last Updated: August 2026

The January 2025 Los Angeles wildfires brought renewed attention to California’s property insurance market. For property owners, the conversation now goes beyond wildfire damage. Insurance availability, claims, property protection, smoke damage, and the California FAIR Plan have all become important parts of managing real estate risk.

In response, California has introduced several new laws and insurance reforms. At the same time, additional proposals are still being considered.

For landlords, multifamily property owners, property managers, and renters, understanding the difference between current law and proposed changes is essential.

Important: This article is for general informational purposes only and does not constitute legal, insurance, financial, or tax advice. Insurance coverage and legal requirements depend on the specific policy, property, and circumstances. Laws and proposed legislation can change. Readers should verify current requirements with the California Department of Insurance, the California Legislature, and an appropriate licensed professional.

What Is Already in Effect?

Several important wildfire-related measures became law and took effect in 2026.

Already in effect:

• AB 888 — California Safe Homes Grant Program

• SB 495 — Insurance and disaster claim protections

• SB 547 — Commercial property insurance cancellation and nonrenewal protections

• AB 226 — FAIR Plan financial stability

• SB 429 — California Wildfire Public Catastrophe Model

Other proposals discussed later in this article, including AB 1795 and AB 1680, are not current law and should not be treated as existing requirements.

1. AB 888: California Safe Homes Grant Program

AB 888, the California Safe Homes Grant Program, created a program within the California Department of Insurance to support wildfire mitigation and improve the resilience and insurability of vulnerable communities.

The law prioritizes wildfire-risk reduction measures such as home hardening and creating a noncombustible area around structures. The program is also intended to help communities take steps that may improve access to insurance incentives.

For property owners, the practical takeaway is simple: wildfire mitigation is becoming an increasingly important part of property management.

Owners should consider keeping records of:

• Roof improvements

• Landscaping and vegetation work

• Inspections

• Fire-resistant upgrades

• Contractor invoices

• Before-and-after photographs

Completing a mitigation project does not automatically guarantee an insurance discount or coverage. Eligibility depends on the applicable program and insurer.

2. Wildfire Safety and Insurance

California's Safer from Wildfires framework encourages property owners to reduce wildfire risk through measures such as defensible space and property hardening.

California's Sustainable Insurance Strategy also allows insurers to use catastrophe models and incorporate mitigation information into the insurance process. The state is requiring insurers participating in the program to expand coverage in certain wildfire-distressed areas.

Potentially relevant improvements can include:

• Fire-resistant roofing

• Ember-resistant vents

• Defensible space

• Vegetation management

• Reducing combustible materials near structures

These improvements may affect insurance eligibility, pricing, or available discounts depending on the property and insurer.

For property managers, this means wildfire preparedness can be incorporated into regular maintenance and inspection planning.

3. California FAIR Plan: What Property Owners Should Know

The California FAIR Plan provides basic property insurance for California residents and businesses that cannot obtain coverage through a regular insurance company. It has become especially important for properties facing higher wildfire risk.

California is also working to increase options in the traditional insurance market and reduce long-term reliance on the FAIR Plan. In 2026, the Department of Insurance reported additional insurers committing to expand coverage in California, while FAIR Plan growth slowed compared with previous periods.

Property owners should review:

• Coverage limits

• Deductibles

• Exclusions

• Liability coverage

• Whether additional coverage is needed

The FAIR Plan should not automatically be assumed to provide the same coverage as a traditional insurance policy.

4. Important Changes for Multifamily Properties: SB 547

SB 547, the Business Insurance Protection Act, is particularly relevant to multifamily owners.

The law extends certain protections against cancellation or nonrenewal of qualifying commercial property insurance policies after a declared state of emergency.

The law specifically includes certain properties used for residential or habitational purposes, including:

• Apartment complexes

• Multifamily properties with more than five units

• Student housing

• Condominium complexes

• Homeowners associations

• Certain senior living facilities

The protection applies under specific circumstances and includes exceptions. It should not be interpreted as a guarantee that every commercial policy cannot be canceled or nonrenewed.

Practical takeaway

Multifamily owners should review their insurance renewal dates early and understand how their particular property and policy are affected.

5. SB 495: Faster Access to Certain Personal Property Payments

SB 495, known as the “Eliminate the List” Act, introduced important protections for certain policyholders following a covered total loss related to a declared state of emergency.

For qualifying losses, insurers must provide an advance payment for personal-property coverage equal to 60% of the applicable personal-property coverage limit, up to $350,000, without requiring an itemized contents claim for that initial payment. The law also provides at least 100 days to submit proof of loss after a declared state of emergency, subject to the law's specific requirements.

The exact amount available depends on the applicable policy and circumstances.

Why does this matter?

After a catastrophic loss, creating a detailed inventory of every damaged or destroyed item can be difficult. This law is intended to provide qualifying policyholders with faster access to part of their available contents coverage.

6. Smoke Damage: A Growing Insurance Issue

The Los Angeles wildfires also highlighted an important issue: a property does not have to be destroyed by flames to potentially experience wildfire-related damage.

Smoke, soot, ash, and other contaminants may affect homes and other residential properties that remain standing.

California created a Smoke Claims and Remediation Task Force to examine issues involving smoke-damage claims, inspection, testing, remediation, and restoration.

Whether smoke-related damage is covered by insurance depends on the specific policy and circumstances.

Property owners should not assume that a property is either safe or covered simply because the structure is still standing. When appropriate, owners should work with their insurer and qualified professionals to evaluate the property.

7. AB 1795: Proposed Smoke Damage Legislation

AB 1795, introduced in 2026, would establish standards and protocols for handling smoke-damaged residential properties following wildfires.

The proposal focuses on issues such as:

• Smoke-damage inspection

• Testing

• Remediation

• Restoration

• Insurance claim handling

As of August 2026, AB 1795 is still an active bill and is not current law. Its language and status may change during the legislative process.

For property owners, this is a proposal worth monitoring not a current requirement to implement.

8. AB 1680: Proposed FAIR Plan Changes

AB 1680 proposes additional changes to the California FAIR Plan.

Among other provisions, the bill would strengthen oversight and allow the Insurance Commissioner to require changes to FAIR Plan policy limits and coverage offerings under certain circumstances.

As of August 2026, AB 1680 remains an active bill in the California Legislature and is not current law.

Property owners who rely on the FAIR Plan should continue monitoring its status, but should not treat the proposal as an existing legal requirement.

9. What About Renters?

Wildfire insurance changes primarily affect property owners and insurers, but renters should also understand their own coverage.

A landlord's insurance generally protects the owner's covered interest in the building. It does not automatically cover a tenant's personal belongings.

Renters should review their renters insurance for:

• Personal property coverage

• Liability coverage

• Additional living expense coverage

• Deductibles

• Wildfire or smoke-related limitations

Keeping photographs or records of valuable belongings can also make the claims process easier.

What Should Los Angeles Property Owners Do in 2026?

Property owners do not need to wait for another wildfire or insurance renewal to prepare.

Review your insurance

Ask your insurance professional to review:

• Coverage limits

• Deductibles

• Exclusions

• Wildfire-related coverage

• Liability coverage

• Loss-of-rent or business-income coverage, where applicable

Review the property

Pay attention to:

• Roof condition

• Vents

• Windows

• Vegetation

• Landscaping

• Combustible materials near structures

• Areas immediately surrounding the building

Keep documentation

Maintain records of:

• Repairs

• Inspections

• Landscaping

• Roof work

• Fire-hardening improvements

• Insurance correspondence

• Claims

• Contractor invoices

Good documentation does not guarantee coverage or a discount, but it can help owners stay organized when working with insurers and contractors.

What Property Managers Can Do

For multifamily property managers, wildfire preparedness can become part of a broader property-management strategy.

At Strategic Growth Real Estate, we believe proactive management means helping owners stay organized, informed, and prepared.

Property managers can help coordinate maintenance, inspections, documentation, and communication with owners. However, insurance coverage decisions should be handled by the property's licensed insurance professional, and legal questions should be directed to qualified legal counsel.

What Property Owners Should Watch Next

California's insurance system is continuing to evolve.

Two proposals are particularly relevant:

AB 1795 — Smoke Damage RecoveryCould establish additional standards for wildfire smoke damage and related insurance claims.

AB 1680 — FAIR Plan ReformCould introduce additional oversight and changes to FAIR Plan coverage and operations.

Because both are still proposals, their status and language should be verified before relying on them.

Conclusion

The 2025 Los Angeles wildfires accelerated changes in California's property insurance landscape, and several of those changes are now affecting property owners in 2026.

For landlords and multifamily owners, the key priorities are understanding insurance coverage, maintaining the property, documenting wildfire mitigation efforts, and staying informed about changes to California's insurance system.

For renters, understanding personal insurance coverage is equally important, particularly when it comes to belongings and additional living expenses.

At Strategic Growth Real Estate, we believe proactive property management is about more than day-to-day operations. It also means helping property owners stay informed about issues that can affect the safety, cost, and long-term management of their investments.

Disclaimer: This article is for general informational purposes only and does not constitute legal, insurance, tax, or financial advice. Insurance coverage, laws, regulations, and eligibility requirements may vary by property and circumstances and may change over time. Readers should verify current information with the appropriate government agency, licensed insurance professional, or qualified attorney before making decisions.

Sources

• California Department of Insurance — Sustainable Insurance Strategy

• California Department of Insurance — California FAIR Plan

• California Department of Insurance — 2026 Wildfire Insurance Protections

• California Legislature — AB 888

• California Legislature — SB 495

• California Legislature — SB 547

• California Legislature — AB 1795

• California Legislature — AB 1680

Information verified against available California government sources as of August 14, 2026. Legislative and regulatory information can change after publication.