California Insurance Commissioner candidate Jane Kim wants state-run disaster insurance program

By Kenny Choi

California’s troubled insurance market is emerging as a central issue in the race for state insurance commissioner, with former San Francisco Supervisor Jane Kim proposing a state-run, nonprofit disaster insurance program that would fundamentally change how Californians are covered for catastrophic losses.

Kim, a Democrat, said incremental changes are not enough to address rising premiums, canceled policies, coverage gaps and disputes over claims.

“I don’t think that just tinkering with the system is going to solve this systematic failure that is the insurance industry,” Kim said.

Kim is proposing what her campaign calls “Natural Disaster Insurance for All,” a public insurance pool that would provide coverage for major disasters. Her campaign said the program would cover risks including wildfires, floods and earthquakes, while private insurers could continue providing coverage for other risks.

“Ideally, it would be one bill that would allow the state of California to open a public nonprofit insurance program, and it would be funded by premiums the same way the private market is,” Kim said.

Kim has said the proposal is inspired in part by disaster insurance systems used in other countries. Under her plan, the state would administer a fund supported by premiums and guarantee disaster coverage.

Her opponent, Democratic state Sen. Ben Allen, has criticized Kim’s proposal and questioned the potential financial exposure for the state.

Kim acknowledges that creating such a program would require legislative action and would take time.

“A program like this would take time and in many ways would depend on the will of the State Legislature,” Kim said.

Kim’s proposal is separate from California’s existing FAIR Plan. 

The FAIR Plan is not a state-run insurance company; it is an association of licensed insurers that provides coverage for property owners who have difficulty obtaining insurance through the traditional market. In 2025, after the Los Angeles fires, the FAIR Plan faced insolvency until current Insurance Commissioner Ricardo Lara stepped in and signed an order authorizing the FAIR Plan to collect $1 billion from its member companies — half of which could be passed on to ratepayers.  

Kim argues that creating a broader public disaster insurance pool could substantially reduce the role of the FAIR Plan, which has grown as private insurers have restricted coverage in areas facing significant wildfire risk. Her campaign describes the FAIR Plan’s coverage as limited and its premiums as too expensive for many homeowners.

Kim is also proposing greater oversight of insurance companies. Her campaign calls for limiting what it describes as excessive insurer profits, increasing disclosure of how companies use premium dollars and strengthening standards governing coverage and claims.

“I think this office has been under the radar, underleveraged, and it can be a powerful platform for working families,” Kim said.

Kim said money collected through a public disaster insurance system could also be invested in reducing future losses, including wildfire prevention, community resilience and home-hardening projects.

“Where we have failed is figuring out how to invest some of the dollars that we are giving to the insurance industry to actually drive down risk, to lower the likelihood of claims being filed in the future by actually lowering the likelihood of communities and homes being ravaged by fires and floods,” Kim said.

Kim has not yet specified how much initial capital would be required to establish the proposed disaster fund.

Current Insurance Commissioner Ricardo Lara cannot seek another term after serving two terms.

Kim and Allen advanced from California’s June 2 primary and will face each other in the November general election. Both are Democrats.