Residential property insurance: loss estimate transparency.

The definition of 'claim-related documents' in the standard fire insurance policy was narrowed: the phrase 'in any way relate to' was changed to simply 'relate to,' removing the broader 'in any way' qualifier that could have captured tangentially related documents.

A new Section 1.5 was added that restates the entire standard form fire insurance policy with SB 876's amendments incorporated, creating a conditional alternative version of the policy text that would apply only if both bills are enacted and SB 877 is enacted last.

Senator Ochoa Bogh was added as a coauthor alongside Senator Allen.

Under the new Section 1.5 (incorporating SB 876 changes), the adjuster status report requirement was modified: the 'within a six-month period' limitation was removed, and a specific 15-calendar-day deadline was added for providing the written status report after a third or subsequent adjuster is assigned.

The new Section 1.5 adds a definition of what must be included in a written status report: a summary of decisions or actions substantially related to claim disposition, including amount of losses, retention of design/construction professionals, coverage amounts, dollar amounts paid to date, and all items of dispute or pending.

A new subdivision (e) was added stating that SB 876's adjuster amendments would govern policies originated or renewed on or after January 1, 2028.

A new Section 2 establishes operative conditions for Section 1.5: it only takes effect if both bills are enacted and effective by January 1, 2027, each amends Section 2071, and SB 877 is enacted after SB 876, in which case Section 1 of this bill would not become operative.

Section 10103.8 was deleted entirely. It would have required insurers to proactively provide the named insured every version of claim-related documents within 15 calendar days of creation or generation, include the full name and title of every person who made, ordered, reviewed, or approved a change, provide a detailed explanation for each change, and post documents in the insurer's document portal where they could not be removed or altered after disclosure.

The definition of 'claim-related documents' in the standard form fire insurance policy was modified to add the phrase 'whether preliminary or final, that in any way relate to' before 'the amount of loss, covered damage, and cost of repairs,' explicitly broadening coverage to include preliminary drafts and calculations, not just final ones.

The bill's overall scope narrowed from adding a new standalone section (10103.8) with proactive disclosure obligations to only amending the existing Section 2071 standard form definition. The act description changed from 'to add Section 10103.8 and amend Section 2071' to simply 'to amend Section 2071.'

The state-mandated local program designation in the digest was corrected from 'no' to 'yes,' aligning with the body text which already acknowledged the bill expands the scope of an existing crime. Assembly Member Harabedian was added as principal coauthor.

The bill now amends Section 2071 of the Insurance Code (the California Standard Form Fire Insurance Policy) in addition to adding the original Section 10103.8, expanding the bill from a single new section to also modifying an existing standard form policy.

The fiscal note changes 'State-mandated local program' from 'no' to 'yes,' acknowledging that the standard form modification imposes obligations on local agencies or school districts.

Section 2071 now requires insurers to notify every claimant that they may obtain copies of claim-related documents upon request, and to provide those documents within 15 calendar days of receiving the request.

A new provision requires insurers to provide a free, complete copy of the policy within 30 calendar days after a covered loss upon request, and one free copy annually for insureds who have not experienced a covered loss.

The definition of 'claim-related documents' in Section 2071 is expanded to explicitly include documents 'whether preliminary or final, that in any way relate to the amount of loss, covered damage, and cost of repairs,' broadening what must be disclosed beyond just final estimates.

Because the bill modifies the standard form fire insurance policy, existing law making it a misdemeanor to issue or countersign a policy that varies from the standard form now applies to these new provisions, effectively creating criminal penalty exposure for non-compliance.

A new Section 2 provides that no state reimbursement is required under Article XIII B of the California Constitution because any local costs would arise solely from the creation or modification of a crime.