SACRAMENTO, CA – Senator Ricardo Lara (D-Bell Gardens) introduced Climate Safe California, Senate Bill 30, to promote the nation’s first insurance market that can help reduce protect communities from climate-caused disasters.
SB 30 orders the Department of Insurance to create a working group to recommend market-based policies that protect California’s “natural infrastructure” and mitigate climate impacts.
The Assembly Insurance Committee unanimously passed the bill today.
SB 30 comes as a recent report showing 20,000 California homes at risk of flooding from rising sea levels by 2045.
Other countries have pioneered the use of insurance to rebuild after a climate disaster. Cancun, Mexico is protecting coral reefs through a policy created with The Nature Conservancy that would support restoration after a major hurricane. The island nation of Barbados insures mangrove swamps that can withstand storm surges and rising sea levels.
Examples of natural infrastructure in California include coastal marshes that can protect communities from flooding, wetlands that can buffer communities from storms and recharge aquifers, and healthy forests that can withstand wildfire and provide cooling effects during heat waves.
“California has been a world leader on climate change but other countries are moving ahead of us in creating market-based solutions that relieve pressure on general budgets,” said Senator Ricardo Lara (D-Bell Gardens). “This is a unique way to utilize the insurance industry to combat climate change and protect our natural infrastructure the way we do our homes and roads.”
Climate insurance would allow communities to invest in protecting their natural infrastructure so funds are immediately available for restoration following a disaster.
“The Nature Conservancy is excited to sponsor SB 30 to generate innovative ideas and emerging approaches to address climate change including using market mechanisms to insure nature to help address climate change,” said Louis Blumberg, director of the Nature Conservancy’s climate change program in California. “We applaud Senator Lara for his leadership and commitment to preparing California for the escalating impacts of climate change.”
“On behalf of our companies who engage in developing creative risk transfer mechanisms around the globe in response to extreme weather events, we are excited to support this forward-thinking measure,” Katherine Pettibone, Western Region Vice President of the American Insurance Association, representing 325 American and international insurance and reinsurance companies. “We believe it will open up a new dialogue with the department and industry leaders.”