The Sad Reason California Is Amending Its Insurance Codes For Vineyards

Wildfires have been running rampant across California every summer for a number of years, but fires are actually a natural part of California's landscape, according to the California Department of Forestry and Fire Protection (via Cal Fire). But over the years, the state's "fire season" has been beginning earlier and ending later, with climate change as the likely culprit. This is sad for Californians in and of itself, but what makes it even worse is that it has led many insurance companies to either withdraw from covering fire-prone areas or make it prohibitively expensive to obtain insurance to cover wildfire-related damage, the New York Times reports. This has made it increasingly difficult for owners of high-risk properties to secure adequate wildfire-related insurance. 

In late July, California's Governor Gavin Newsom signed a piece of legislation into law that amends the California Insurance Code in order to permit agricultural properties — such as orchards, farms, and vineyards — to obtain "basic fire insurance coverage for high risk properties" through the state "when traditional insurance companies will not" provide the same (via Food & Wine). This might seem like a no-brainer, until you understand the sad reason this amendment to the insurance code became necessary. 

Historically, high fire-risk California property owners were entitled under the California FAIR Plan to secure a minimal level of fire insurance coverage through the state. However, owners and operators of agricultural properties were flat-out excluded from this rubric, per Food & Wine. As a result, not only did vineyards and other agricultural businesses like orchards find it difficult, if not impossible, to find a commercial insurance underwriter, they weren't even able to secure insurance from the state's mandated fund. 

The newly amended California insurance code seeks to correct this problem. Although the California FAIR Plan offers only the most basic of fire insurance and applies only when a property owner has tried and failed to secure insurance from the commercial marketplace, when California Governor Gavin Newsom signed Senate Bill 11, he may well have kept some of your favorite winemakers in business. However, Food & Wine notes that this policy won't apply until October, so struggling agricultural businesses may find themselves waiting longer than they'd like for coverage.