WELL TO THE JOINT INFORMATIONAL
HEARING BETWEEN THE ASSEMBLY
INSURANCE COMMITTEE AND THE
ASSEMBLY EMERGENCY MANAGEMENT
COMMITTEE. TODAY THE COMMITTEE
WILL DISCUSS CATASTROPHE
MODELING AND HOW THIS METHOD
PARTNERS WITH INSURANCE IT'S
BEEN SAID TIME AND TIME AGAIN
THAT AN OBSTACLE TO THE
CALIFORNIA INSURANCE MARKET IS
THAT INSURERS CAN ONLY LOOK
BACKWARDS AND NOT FORWARDS WHEN
IT COMES TO EVALUATING RISK. I
CALIFORNIA REGULATION INSURERS
ARE PROHIBITED FROM
INCORPORATING CATASTROPHE
METHODS INTO THEIR RATING
FORMULA BASED ON THE RECENT
ANNOUNCEMENT ANNOUNCEMENTS BY
STATE FARM AND OTHERS IT'S TIME
TO COME TO THE TABLE TO SEE WHAT
CHANGES NEED TO BE MADE TO
ENSURE THE VIABILITY OF THE
STATE'S INSURANCE MARKET. OUR
INSURANCE MARKET THRIVES BASED
ON COMPETITION AVAILABILITY
BRINGS AFFORDABILITY WHICH IS
MONUMENT A MONUMENTAL COMPONENT
FOR OUR CONSTITUENTS I'M LOOKING
FORWARD TO HEARING FROM OUR
PANELIST ON HOW CATASTROPHE
MODELING WORKS AND WHETHER THESE
METHODS WOULD HELP PREVENT
INSURERS FROM PUSHING THE PAUSE
BUTTON BEFORE WE START WITH OUR
FIRST PANEL I'D LIKE TO HAVE THE
MIKE OVER TO. ASSEMBLY MEMBER
RODRIGUEZ CHAIR OF THE ASSEMBLY
EMERGENCY MANAGEMENT COMMITTEE
FOR HIS OPENING REMARKS. GOOD
MORNING ASSEMBLY MEMBER FREDDIE
RODRIGUEZ CHAIR OF THE
SUBCOMMITTEE ON MUNCHING
MANAGEMENT. AND VICE CHAIR OF
THE SEISMIC SAFETY COMMISSION.
FIRST LET ME THANK MY FRIEND AND
COLLEAGUE ASSEMBLY MEMBER
CALDERON CHAIR OF THE ASSEMBLY
CHARLES COMMITTEE FOR CONVENING
THIS JOINT OVERSIGHT HEARING.
AFTER TAKING A HARD LOOK AT THE
CHALLENGES FACING CALIFORNIA'S
INSURANCE MARKETS. CALIFORNIA IS
A DISASTER PRONE STATE AND
CLIMATE CHANGE WILL ONLY MAKE
DISASTER MORE FREQUENT AND MORE
COSTLY. IN ADDITION TO OUR
TRADITIONAL INVESTMENTS AND
HAZARD MITIGATION SUCH AS
SEISMIC SEISMIC RETROFITS ON
WILDFIRE MITIGATION INSURANCE
AND CATASTROPHIC MOLLY NEEDED TO
BE PART OF OUR OVERALL PREPARE
ANDERSON CONVERSATION. MRS
CALDERON AND I HAVE SHARED
COMMITMENT TO MAKING CALIFORNIA
MORE RESILIENT TALK HAUSER'S AND
BETTER PREPARED TO RESPOND TO
MULTIPLE DISASTERS. WERE ALSO
COMMITTEE MANAGER TO MANAGEMENT
RISK IN THE MOST EFFECTIVE WAY
TO ENSURE HADN'T HAZARD
MITIGATION PROJECT PROTECT LIVES
AND PROPERTY. EDUCATION PROJECTS
WHETHER THEY REDUCE SEISMIC
WILDFIRE OR FLOOD RISKS SHOULD
ALSO BE DESIGNED TO ENSURE THE
AVAILABILITY OF INSURANCE. AND
BE HELPFUL TO RATE PAYERS. I
LOOK FOR TODAY'S DISCUSSION AND
HEARING MORE FROM OUR PARTNERS
IN THE ADMINISTRATION ON HOW
WE'RE USING CATASTROPHIC MULLIN
TO MAKE SMART HAZARD MITIGATION
INVESTMENTS. ALSO WONDER REMIND
EVERYBODY WILL BE HAVING A HARD
STOP AT ELEVEN AM. AND BEFORE
GOING TO FIRST TIME I KNOW WE
HAVE TWO OF OUR COLLEAGUES HERE
IF THEY WANT TO SAY A FEW WORDS
BEFORE WE GET STARTED. THANK YOU
. MISTER MISTER. BUT I AM ALSO
GRATEFUL FOR THE PANEL TODAY
LOOK FORWARD TO HEARING FROM THE
VARIOUS STAKEHOLDERS AND THE
INSURANCE DEPARTMENT TO
UNDERSTAND HOW THESE
CATASTROPHIC MODEL MODELS CAN BE
USED TO BETTER ASSESS RISK. AND
TO IMPROVE THE HEALTH OF THE
ADMITTED INSURANCE MARKET
BECAUSE I THINK THAT'S THE GOAL
WE HAVE HERE IS TO HAVE A
HEALTHY MARKET WHERE PEOPLE CAN
HAVE. A AFFORDABLE RATES AND
STAY IN THE MARKET AS WE KNOW
THE FAIR PLAN IS. IS A TEMPORARY
BUT NOT A PERMANENT SOLUTION SO
I LOOK FORWARD TO A ROBUST
CONVERSATION TODAY HOPEFULLY WE
CAN OUTLINED WHAT THE PATH
LOOKS. WHAT WHAT THE PATH IS TO
IMPLEMENT THESE MODELS IN A
REASONABLE TIME LINE SO THANK
YOU AND LOOK FORWARD TO THE TO
THE TO THE CONVERSATION. THE
WALK. SOME OF OUR TELE. I ALSO
LIKE TO THINK THAT- FOR IT
TODAY'S. LOOKING FORWARD TO
HAVING NO WORLD CONVERSATION AND
BEING ABLE TO ASK SOME QUESTIONS
IN REGARDS TO CONSUMERS AND YEAH
DRESSING OR CLIMATE CHANGE- BUT
ALSO MAKING SURE THAT WE'RE
PROTECTING. OUR CONSTITUENTS AND
THEY HAVE ACCESS TO EQUITABLE
COVERAGE SO LOOKING FORWARD TO
TODAY'S DISCUSSION THANK YOU.
RIGHT THANK YOU ARE MUCH SO WITH
THAT WERE INTRODUCED OUR FIRST
PANEL CATASTROPHIC MODELING WITH
THAT LET'S FIRST CALL UP OUR
FIRST- PERSON WERE FIRST WE'LL
HEAR FROM DR ROGER. GREENER
SENIOR VICE PRESIDENT CONSULTING
AND CLIENT SERVICES VERISK.
WHEN READY SIR. READ WELL GOOD
MORNING. MY NAME IS ROGER
GRENIER- AND FIRST I WANT TO
THANK GOD PERSONAL RON CONTRA
PERSON RIGHT. AND THE OF THE
ENSURE IN EMERGENCY MANAGEMENT
COMMITTEES FOR HIM INVITING ME
TO SPEAK TO YOU TODAY. I'M NOT
REMARKS TODAY WANT TO PROVIDE A
BRIEF OVERVIEW OF CATASTROPHE
MODELING- WITH SPECIFIC
APPLICATION TO WILDFIRES- AND
OUT I JUST KNOW THAT I READ THE
BACKGROUND DOCUMENT CIRCULATED
AHEAD OF TIME HAVE THIS MEETING
OF IT WHICH IS QUITE WELL DONE.
AND SO I HOPE TO AMPLIFY SOME OF
THOSE POINTS. AND ADD SOME
ADDITIONAL COLOR TO THE
DISCUSSION. SO COULD MOVE TO THE
NEXT SLIDE. PERFECT SO FIRST WHY
DO WE NEED CATASTROPHE MODELS
WELL IF INSURANCE COVERS MANY
KINDS OF EVENTS SO FOR EVENTS
THAT OCCUR WITH HIGH FREQUENCY.
FOR EXAMPLE THEFT VANDALISM
BROKEN PIPES INSURERS HAVE
ABUNDANT HISTORICAL DATA AND
THEY CAN USE A STATE OF THE
PRICE THESE TYPES OF EVENTS AND
ALSO UNDERSTAND THAT THE RANGE
OF LOSSES SIZE OF LOSSES THAT
CAN OCCUR. FOR INFREQUENT EVENTS
LIKE FLOODS AND WILDFIRES.
INSURERS DO NOT HAVE SUFFICIENT
DATA. THEY DON'T HAVE ENOUGH
DATA TO ACCURATELY PRICE RISK
WHAT IMPORTANTLY THERE'S NOT
ENOUGH DATA TO UNDERSTAND HOW
LARGE THE EVENTS CAN BE. IT'S A
WITHOUT A GOOD UNDERSTANDING OF
THE AGGREGATION OF RISK ACROSS
MANY POLICIES. INSURERS ARE
UNABLE TO MANAGE THEIR EXPOSURE
STRUCTURE THE REINSURANCE
CONTRACTS. AND REALLY BE ABLE TO
ENSURE THAT THEY ARE ABLE TO PAY
THE CLAIMS FOLLOWING A
CATASTROPHIC EVENT. SO FOR THESE
LOW FREQUENCY HIGH SEVERITY
EVENTS INSURERS USE CATASTROPHE
MODELS TO SIMULATE THE RANGE. OF
EVENTS IN LOSSES IT CAN HAPPEN.
SO THE CATASTROPHE MODELING
FRAMEWORK IS SHOWN THERE IN IN
THE GRAPHIC- THE TERMINOLOGY IS
A BIT DIFFERENT THAN WHAT WAS IN
THE BACKGROUND DOCUMENT BUT
BASICALLY THERE ARE THREE
COMPONENTS. THERE'S A HAZARD
COMPONENT- THE DESCRIBE THE TYPE
OF EVENTS- IN THE INTENSITY OR
IMPACT. FOR EACH EVENT. I IN THE
MIDDLE THERE IS THE ENGINEERING
OF THE VULNERABILITY COMPONENT
DESCRIBES THE DAMAGE AT TWO
DIFFERENT BUILDING TYPES THE
DIFFERENT LEVELS OF EVENT
INTENSITY. AND FINALLY A
FINANCIAL COMPONENT THAT
DESCRIBES THE MONETARY LOSS. TO
NOT ONLY THE INSURER BUT ALSO
THE LOSSES ARE PASSED ON TO
REINSURERS OR INTENT RETAINED BY
THE- BY THE INSURED. SO I JUST
GOT THE FIRST TWO COMPONENTS A
BIT MORE DETAIL IN THE FOLLOWING
SLIDES. SO FOR THE NEXT SLIDE
PLEASE. THANK YOU. SO STARTING
WITH THE HAZARD COMPONENT- WE
BUILD WHAT WE CALL A MODEL
CATALOG WHICH WHICH IS REALLY
CONTAINS THE COLLECTION OF
PLAUSIBLE SIMULATED. BUT
REALISTIC EVENTS THAT FORM THE
BASIS FOR THE LOSS ESTIMATES. IN
THE CASE OF WILDFIRE IN ORDER TO
CREATE THE CATALOG WE NEED A
GOOD UNDERSTANDING OF THE
CONDITIONS THAT CAN LEAD TO
WILDFIRE FORMATION. IN EACH
SIMULATED YEAR WE NEED TO MODEL
MODEL NOT ONLY THE WEATHER. AND
CLIMATE CONDITIONS FOR THAT
YEAR. BUT ALSO THE WEATHER AND
CLIMATE A PRECEDING YEARS THE
INFLUENCE OF VEGETATION AND
FUELS AVAILABLE TO BURN. IN THE
BACKGROUND DOCUMENT THERE WAS
REFERENCE TO RECENT PERIODS OF
DROUGHT AND HIGH TEMPERATURES IT
AND THE INFO INFLUENCE THAT THAT
HAD ON RECENT WILDFIRE RISK. IS
IT ISN'T EXACTLY TO THE TYPES OF
CYCLES THAT WE CONSIDER. THAT
WHEN WE BUILD THE CATALOG. WE
ALSO NEED TO UNDERSTAND THE
VARIABILITY IN THE VEGETATION IN
THE FUELS ARE GEOGRAPHICALLY.
WHICH HAS A SIGNIFICANT IMPACT
ON THE PROPENSITY BURN IN ON THE
FIRE SPREAD. IT'S SO EASY
BAILABLE DATA ON FUEL TO CAPTURE
THE CURRENT STATE OF THE
LANDSCAPE. I'LL POINT OUT HERE
THAT WE USE HISTORICAL DATA FROM
ROUGHLY THE LAST FORTY YEARS- TO
SIMULATE REALISTIC WEATHER. AND
CLIMATE CYCLES WHICH ALLOWS US
TO A COP FOR THE CLIMATE CHANGE
THAT HAS ALREADY OCCURRED. WHEN
ESTIMATING THE RISK IN TODAY'S
CLIMATE. SO THE REST TODAY IS
REALLY THE DEFAULT VIEW OF RISK.
FOR INSURANCE APPLICATIONS. BUT
WE I'LL POINT OUT WE CAN ALSO
USE FUTURE PROJECTIONS OF
WEATHER AND CLIMB TO SIMULATE
THE IMPACTS OF CLIMATE CHANGE. I
INTO THE MODELING FRAMEWORK IS
FLEXIBLE ENOUGH TO ACCOMMODATE
THAT APPROACH. TO GO TO THE NEXT
SLIDE PLEASE. THANK YOU. SO
STARTING WITH THESE
ENVIRONMENTAL CONDITIONS THE
SIMULATION NEEDS TO CONSIDER A
NUMBER OF OTHER FACTORS.
INCLUDING HISTORICAL IGNITION
LOCATIONS. THE NETWORKS OF ROADS
AND POWER LINES THAT COULD
CONTRIBUTE TO NEW IGNITIONS. AS
WE KNOW MOST EVENTS OCCUR AS A
RESULT OF HUMAN ACTIVITY IN
PROXIMITY TO ROADS IS A
CONTRIBUTING FACTOR. WE ALSO
NEED TO UNDERSTAND THE DENSITY
OF FUELS AS MENTIONED. AND THE
LOCATION OF THE WILDLAND URBAN
INTERFACE- WHERE WE HAVE A MIX
OF NATURAL FUELS. AND MANMADE
STRUCTURES- WE INCLUDE SOMETHING
CALLED URBANISED CITY AS AN
INDICATOR OF WHERE PEOPLE LIVE.
AS IT RELATES TO FIRE
SUPPRESSION. WE EXPLICITLY MODEL
FIRE SUPPRESSION ACTIVITIES BY
CONSIDERING THE AVAILABILITY OF
WATER SUPPLY. IN THE
CONCENTRATED FIRE FIGHTING
EFFORTS WHICH OCCUR IN
PROXIMITY. TO AREAS WITH
SIGNIFICANT PROPERTY
DEVELOPMENT. SO WE CONSIDER ALL
THESE FACTORS. THE NEXT SLIDE
PLEASE. THE MALL MODEL ALSO
INCLUDES PHYSICALLY REALISTIC
FIRE SPREAD SO FOR EACH
SIMULATED EVENT IN THE CATALOG
WE CONSIDER THE PHYSICAL
ENVIRONMENT IN AND AROUND THE
MISSION POINT. AND THEN SIMULATE
PLAUSIBLE WEATHER CONDITIONS FOR
THAT LOCATION IN THE SEASON OF
THE SIMULATED FIRE. SO THE GOAL
IS TO CREATE PHYSICALLY
REALISTIC BURN PERAMA PERIMETER
. AND IF THE STATES THAT THE
MODELING SAW EFFECT INTERSECTS
THE INTERSECTS THE PROPERTY
DATABASE OF. FOR EXAMPLE
INSURANCE PORTFOLIO. IN THE
CALCULATES THE DAMAGE TO THE
PROPERTY IN AND- WITHIN AND
AROUND THE PERIMETER. SO SLIDE
SIX PLEASE. THANK YOU. IN
MODELING PHYSICALLY REALISTIC
FIRES WE NEED TO ACCOUNT FOR
VARIATIONS IN INTENSITY AND THE
DIFFERENT MECHANISMS FOR FIRE
SPREAD INCLUDING SURFACE SPREAD.
SURFACED A CANOPY TRANSITION
CANTABRI SPREAD OUT AND BRANDING
AND SPOTTING SPREAD BY MEMBERS
WHICH IS CRITICALLY IMPORTANT
AND URBAN- IN OTHER DEVELOPED
AREAS. GO TO THE NEXT SLIDE
PLEASE. SO THAT'S REALLY A AN
OVERVIEW OF THE HAZARD
COMPONENTS ARE MOVING NOW TO THE
ENGINEERING OF VULNERABILITY
COMPONENT THIS IS WHERE WE
RELATE THE FIRE INTENSITY TO THE
BUILDING DAMAGE. AND WE DEVELOP
WHAT WE CALL A SET OF DAMAGE
FUNCTIONS. WHICH ARE SPECIFIC TO
DIFFERENT BUILDING- DIFFERENT
STRUCTURE TYPES. SO IN ADDITION
TO ACCOUNTING FOR UPDATED
BUILDING CODES WE CAN EXPLICITLY
INCLUDE STRUCTURAL INSIGHTS
SPECIFIC FEATURES THAT INFLUENCE
WILDFIRE RISK FOR EXAMPLE WE CAN
CONSIDER DEFENSIBLE SPACE. OR
ROOF TYPE OR OTHER FEATURES THAT
CAN DIFFERENTIATE ONE PROPERTY
FROM THE NEXT. WE CAN ALSO
CONSIDER COMMUNITY LEVEL EFFORTS
WHEN THIS INFORMATION IS
AVAILABLE LIKE FIREWISE USA FOR
EXAMPLE. SO IT MAYBE IT'S USEFUL
AT THIS STAGE TO STEP BACK AND
RECALL KIND OF A MODELING
FRAMEWORK INTRODUCED IN EARLIER
ANSWER ESSENTIALLY WE'VE
OUTLINED THE BASIC STEPS. OF THE
PROCESS FOR A SINGLE EVENT WITH
THE FIRST WE DEFINE THE EVENT.
IN TERMS OF EXIT IS OF ITS
ADMISSION LOCATION ENVIRONMENTAL
CONDITIONS NEXT WE SIMULATE THE
FIRE SPREAD. TO CALCULATE THE
PERIMETER IN THE INTENSITY
WITHIN THE PERIMETER WITHIN
INTERSECT THE PERIMETER WITH THE
DATABASE OF WHERE THE MAP OF
INSURED AND UNINSURED LOCATIONS.
FOR EACH LOCATION WITHIN THAT
PERIMETER. WE APPLY THE PROPERTY
DAMAGE FUNCTION. TO CALCULATE
THE DAMAGE TO EACH PROPERTY AND
THEN WE CARRY THE DAMAGE
FUNCTION FORWARD INTO THE
FINANCIAL COMPONENT TO APPLY
POLICY MUNITIONS AND CALCULATE
THE BEARS LOST RESPECT. SO
THAT'S THE PROCESS FOR ONE EVENT
AND EFFECTIVELY THE MODEL JUST
REPEATING THIS PROCESS OVER AND
OVER AGAIN FOR THOUSANDS OF
EVENTS IN THE CATALOG. SO WE
ARRIVE AT A LOSS REACH EVENT.
AND THAT'S HOW I DETERMINE THE
PROBABILITY DISTRIBUTION OF
LOSSES EXCEEDING PROBABILITY
CURVES AND THE OTHER METRICS
THAT WERE DESCRIBED IN THE IN
THE BACKGROUND DOCUMENTS. SO
THAT NEXT SLIDE PLEASE SO BEFORE
I SUMMARIZE. BUT I WANT TO
HIGHLIGHT THIS IMAGE MAY BE A
LITTLE BIT TRICKY TO SEE IN THE
BACK BUT- IT ILLUSTRATES HOW
CATASTROPHE MODELS CAN REALLY
AUGMENT HISTORICAL DATA- IN
AREAS THAT HAVE EXPERIENCED
SIGNIFICANT DEVELOPMENT OVER THE
YEARS. SO THESE IMAGES ARE FROM
SAN DIEGO COUNTY. AND WE'VE
OVERLAID HE'S- HIS HISTORICAL
FIRE PERIMETER WHICH IS SHOWN.
IN THE RED- LINE IF YOU CAN MAKE
THAT OUT- SO THAT'S A HISTORICAL
FIRE PERIMETER AND IT'S SHOWN ON
AN IMAGE. ON THE LEFT AROUND THE
TIME THAT THE FIRE CREWS THIS IS
FROM MAY OF NINETEEN NINETY FOUR
THE FIRE WAS IN IN. NINETEEN
NINETY THREE. THIS IS AN AREA
AND SENT TO SAN DIEGO COUNTY. SO
ON THE LEFT IS BASICALLY THE
LEVEL OF DEVELOPMENT AT THE TIME
OF THE EVENT. ON THE RIGHT. IS
THE AN IMAGE FROM THE SAME AREA.
WITH THE SAME FIRE PERIMETER.
BUT THE IMAGES TAKEN ABOUT
TWENTY YEARS LATER SO YOU CAN
SEE THE SIGNIFICANT LEVEL
DEVELOP THAT HAS OCCURRED WITHIN
THE FIRE PERIMETER IN THAT IN
THAT TWENTY YEAR PERIOD- AND
OBVIOUSLY AT THE TIME OF THE
EVENT THE LOSS WOULD HAVE BEEN
VERY LOW. IF THE EVENT WERE
RECURRING WOULD BE VERY
DIFFERENT STORIES SO I THINK
THIS ILLUSTRATES WHAT I THINK WE
ALL UNDERSTAND INTUITIVELY. AND
THAT IS THAT THE HISTORICAL LOSS
RECORD WILL HAVE GAPS. IN
CAPACITY MODELS CAN HELP FILL
THOSE GAPS TO PROVIDE A MORE
COMPLETE VIEW OF THE RISK- AND
FINALLY MY LAST SLIDE- SO THE
SLIDE REALLY JUST SUMMARIZES.
WHAT IT DESCRIBES TODAY FOR THE
PURPOSE OF CATASTROPHE MODELS
WHICH IS REALLY TO AUGMENT THE
HISTORICAL RECORD FOR THIS VERY
LOW FREQUENCY HIGH SEVERITY
EVENTS. THE MODELS PROVIDE
REALISTIC SIMULATIONS OF
POTENTIAL LOSSES BY CONSIDERING
CLIMATE WEATHER FUELS.
HISTORICAL SOURCES OF IGNITION-
WE CONSIDER PHYSICALLY BASED
FIRE SPREAD- AN ACCOUNT FOR THE
INFLUENCE OF BUILT ENVIRONMENT.
IN ADDITION ACCOUNTING FOR
WILDFIRE MITIGATION FIRE
SUPPRESSION- AND IMPORTANTLY AS
WE'VE JUST SHOWN. DEMOLISHED
CAPTURE NEW DEVELOPMENT AND
INCREASED EXPOSURE OVER TIME.
AND FINALLY I'LL JUST SAY THAT
ATASSI ALL TO HELP ADVANCE THE
GOAL WITH THAT I THINK WE ALL
SHARE WHICH IS TO IMPROVE OUR
UNDERSTANDING OF. AND ABILITY TO
MANAGE WILDFIRE RISK AND AS WE
WORK TOWARDS THIS GOAL. WE
CONTRIBUTE TO HELPING
INDIVIDUALS FAMILIES AND
BUSINESSES RECOVER FROM THESE
DEVASTATING EVENTS. SO WITH THAT
THANK YOU I'LL TAKE ANY
QUESTIONS. THANK YOU VERY MUCH
WILL HEAD ON TO OUR NEXT-
PANELIST AND THEN OUR NEXT-
PERSONALE NEXT WE'LL HEAR FROM.
AHMED WANI CHIEF EXECUTIVE
OFFICER AND CO FOUNDER OF ONE
CONCERN. WHEN YOU'RE READY SIR-
THANK YOU FOR HAVING ME UP. SO I
. ONE CONCERN IS A- IS A SEVEN
YEAR OLD TECHNOLOGY START UP
BASED IN MENLO PARK- WILL NOT
DEPLOYED IN THE UNITED STATES
OFFICE MARKET WAS JAPAN AND SO
MOST OF OUR WORK HAS BEEN WITH
JAPAN SO MOST OF. I'M GOING TO
BE BUILDING ON SORT OF WHAT WHAT
ROGER HAS ALREADY GIVEN YOU IS
LIKE A BUT POPE OF DETAILED
UNDERSTANDING OF HOW CATASTROPHE
MODELING WORKS AND HOW IT
FUNCTIONS RIGHT. SO UP AS AN AS
A QUICK OVERVIEW OF WHAT THE
NEXT TYPE IS ALSO. ONE CONCERN
IS TRYING TO BUILD WHAT BECAUSE
THE DIGITAL INFRASTRUCTURE FOR
PHYSICAL RISK WE DO THREE THINGS
MAPPING ANALYSING AND MONITORING
EVERY PIECE OF THE WORDS BUILT
ENVIRONMENT AND UNDERSTANDING
ITS CONNECTION TO THE GLOBAL
ECONOMY. SO WE DON'T NECESSARILY
BUILD A NEW CATASTROPHE MODELS
AUTO FINE ON CLIMATE CHANGE OF
THOSE KIND OF THINGS. BUT
ESSENTIALLY WORK WITH LIKE KIND
FIFTEEN SORT OF THESE CLIMATE
FORECAST OF THE MODELING. TO
ULTIMATELY- YOU KNOW BUT LET OF
THEM ON OUR- WHAT YOU CALL AS
THE GRAPH OF THE BUILT
ENVIRONMENT I TRY TO ILLUSTRATE
THIS THE PROBLEM YOU'RE TRYING
TO SOLVE THROUGH INTO AN
EXAMPLE. OF SO TWENTY SEVENTEEN
WHEN HE WAS STILL KIND OF
GETTING STARTED UP WE GOT A
PHONE CALL FROM AN INSURANCE
COMPANY THEY WERE TRYING TO HAVE
IN THE ACCOUNT OF ONE OF THE
LARGEST LOGISTICS COMPANIES THAT
YOU ALL. KNOW AND- THEY WERE
LIKE CAN YOU GUYS JUST YOU WOULD
YOU DO SOMETHING ON A AYE AND-
YOU SAW YOUR VIDEO ON THE
STANFORD ENGINEERING WEBSITE SO
CAN YOU GUYS COME AND- IMPRESS
THEM- ABSOLUTELY B. I MEAN
DECIDED. NICE IF I BUT EVEN THAT
OP ED YOU LAND DOWN THE HOUSE.
SCENARIOS ON THIS WAY. FOR IN C.
I. THIS LARGE LOGISTICS FOR SAID
. ON THE WEST COAST- WHAT HE
FOUND WAS THAT AT INTENSITIES.
TO ALMOST A SIX MAGNITUDE. SIX
POINT SIX POINT THREE SIX POINT
FOUR MAGNITUDE THEY LOST POWER.
AT SEVEN POINT ONE SEVEN POINT
TWO THEY LOST WATER. AT SEVEN
POINT EIGHT THE NEAREST BRIDGE
WAS SHUT DOWN FOR INSPECTION
CUTTING OFF ACCESS TO THE PORT
AND IT WAS ONLY AT A NINE
MAGNITUDE. THAT THE BUILDING.
ITSELF STARTED. TO GET YOU
STARTED TO SHOW TAKE- YOU KNOW
YOU STARTED REAL. THAT OF THESE
BUILDINGS WHICH ARE OF. FIVE
HUNDRED FORTUNE MONTHS FACILITY
THAT ARE IN ZONES ON ONE OF A TO
WIND UP QUICK LIVE FIVE NOTHING
. I BUT THE SURROUNDING
INFRASTRUCTURE. IS THE ONE THAT
HAVE IN IN MY- PERSON OF THE
CASES. THE SURROUNDING INTEREST
ON AS MUCH OF ONE OF AND GIVES
A- FOR. RIGHT I'M SO EXCITED
THIS WEEK THIS WAS THE- OF US.
RIGHT- IT'S THE IT'S THE REST
JUST NOT. TO THE FIRST. BUT
PHYSICAL. IS GOING TO AFFECT THE
BOTTOM LINE ALL OF THESE
COMPANIES ARE THE OPPOSITE. OF
ALL FROM FACILITY- YOU KNOW AS
WITH IT COULD. MY POWER OUTAGE
SUPPLIES JUST. EXCEPT NEXT NIGHT
SO IS SENSE. YOU KNOW WE- WONDER
KNOW WHAT OUR PEOPLE DO ABOUT
THIS AND WHAT IS THE SIZE AND
SCOPE OF THIS RISK. TWENTY YEARS
BACK DEPENDENCY THIS WAS
NEGLIGIBLE IN THE U. S. FORTY
YEARS BACK IT WAS ZERO. WE DO
NOT REALLY HAVE ANY MASSIVE.
POWER OUTAGES DUE TO WEATHER OR
SUPPLY CHAIN NOTICES TO DO
WHETHER IN THE LAST JUST TWENTY
YEARS. THIS DEPENDENCY RISK HAS
GONE UP TEN TIMES IN THE LAST-
ALMOST A THIRTY SEVEN TO FORTY
YEARS. ALMOST. A TWO ORDERS OF
MAGNITUDE NINETY TIMES- FLUTTERS
BECAUSE ON ONE OF THEM DIGIT
FOR. OVER PERIOD. SO WHAT'S THE
CLIP HEAD. THE GLITCHES THE
INTEREST BUDGET THAT. WE
CONTINUE TO SPUR. A OF MONEY-
YOU KNOW SO. COULD LOOK. SECTOR
SO IT UPGRADE THEIR OWN FOR. YOU
MUST FACILITY. THE ROCK LARGER.
TOWER BUT NOT ENOUGH WE
UPGRADING OUR IN. THE SOUND
INTEREST AND THERE'S A HUGE
INFRASTRUCTURE BUDGET. OF IT'S
THE AILING. GRID THE ROADS JUST
. THE HIVE IS THE- EXCEPT UNDER
WITH THE WATER SYSTEMS. SYSTEM
SO IS. UP A- WAY OFF UNDER. OF
THE CATASTROPHE MORE IS A G.
SYSTEMS WHICH IS A- NAY. THEM TO
MY- MAP. LOOK A FLOOD MAP AND
SEE. WHO'S ON THE PHONE ON TODAY
WHO'S GOING TO THE FLOODS ON TEN
YEARS FROM OUT. YEARS FROM NOW.
WE TO STAY BECAUSE I DID FOR
APPROACH WE WILL LIKE WITH WILL
OF THE WORLD IS NOT. TO DO MY-
IT'S MODEM. SO WE SHOULD MARVEL
AS A- OF THINK IT LIKE A SPY WEB
NODES AND EDGES. EVERY
FACILITIES A NORD EVERY OTHER
OFFICE ANOTHER NOTED THAT
CONNECTED TO THESE EDGY. AND
THOSE ARE THOSE DEPEND. THE ROAD
SYSTEM THE HIGHWAYS THAT CARE
THE DATA CABLES THE WATER PIPES
POWERLINES. AND WE SET OUT TO
BUILD THIS GRAPH MICHAEL ALL
THIS DATA ONE BY ONE. FOR CITY-
THAT'S WHY DO A SEVEN YEAR TO
YOU AND- A PRODUCT. SO WE OF YOU
KNOW BECAUSE- YOU KNOW HOW OF
CITY WILL OF WORTH OF DATA AND
THEN BE STARTING MACHINE TO BE
ABLE TO SORT OF UNDER. THAT A
ICE TO GENERATE THE DATA FOR.
THOSE CITIES WHICH TO HAVE STATE
A- BECAUSE KNEW HOW CITIES ARE
AND HOW THE REST TO HAVE. NOW.
BECAUSE FUKUSHIMA HAD THE EXACT
SAME CHARACTERISTICS LIKE THAT
LOGISTICS FACILITY IT DOES NOT
INUNDATED BY THE TSUNAMI IT WAS
ACTUALLY STANDING TALL BUT IT
HAD A POWER OUTAGE AND IT
STARTED GET OVERHEATED ALL THEY
HAVE TO DO IS TO GET IN WE'LL
GET UP TO A HUNDRED ON THE
BOTTOM FLOOR. SO THAT IT COOLS
DOWN BUT THEY HAD AN OLDER THE
ROAD ACCESS WAS BLOCKED FOR THE
TWO DEPENDENCIES THAT THEIR
POWER AND TRANSPORTATION SO
ESSENTIALLY THE IN COLLABORATION
WITH THE MINISTRY OF ECONOMY THE
MINISTER OF LONDON IN FIRST THE
KEPT THE PROMISES OFFICE IN
JAPAN. HELLO WITH THE INSURANCE
SAMPLE THE LAUNCH A THE KIND OF
A MAY UP- MANY. TO BE A TO BILL
THE- SO. TO
WHETHER IT'S SHAKEN ORDERED
BREAK AND ENTER THE AUSSIE
RIPPLE EFFECT SECOND THIRD
FOURTH ORDER AFFECTS THE MEASURE
EVERYTHING IN TIME SO WE CAN
MEASURE SORT OF POWER DOWNTIME
WHICH IS WHICH THE FACILITY IS
GOING TO HAVE. TO DATE OR TENURE
FROM NOW YEARS FROM NOW TO THE
PLAN CHANGE ORDER SUPPLIES DOWN
WHAT HIGH DOWNTIME. THE YOU KNOW
THE LET'S SAY THAT THIS IS THE
TWIN THE U. S. HAS TRILLION DATA
POINTS- IT DID OUT AND
ELECTRICAL. IN THE U. S. A.
EVERY GRAIN THE PORTABLE- YOU
KNOW AT LEAST. DETAIL NOW. I
WANT TO QUICKLY TALK ABOUT A FEW
THE- OFF THIS OTHER BE A LOT I
MEAN IS SORT OF A AND FOR
SERVICE. SO WE WILL COULD COME
TO BE ABLE HELP THEM PRICE IN
SECURE. OF OTHER TO DURING- YOU
KNOW I SAID MANAGE EXCEPT- WE
ALSO HELPING COMPANY REDUCE THE
BUSINESS AND CLAIM. OF ITS ARE
NOT ABLE TO OTHERWISE HAVE A
GOOD GRASP ON BECAUSE THAT
UNDERSTANDING FACILITY TO. I'M
BUT UP ABOVE ME AFTER- IT HAS
MITIGATE- CLIMATE UP AND I
WANTED TO JUST SPOKE ON THAT
SPECIFICALLY BY POOR OUT TO CASE
STUDIES WELL THEM IS ACTUALLY
FROM. SO WE HAVE THIS OF A
RESILIENCE WHICH YOU BEEN FROM
THE MISS OF MAKE ON. OF JAPAN I
THIS POINTS ON THIS COMPANY
WHICH IS NOT ROLLED OUT. SOME OF
THOSE SOME OF FOLKS- NOT. YOU
KNOW. THE EVERY OF. IS AFFECTED
BY DANTE DIFFERENT- THE SOME
UNDERSTAND THAT I'D SAY IT LEADS
LET'S TAKE A HOTEL EVEN OF THE
HOT A DAY OFF. PEOPLE NOT BEING
ABLE TO INTO THE WHOLE. THEY
WILL CASUAL. RIGHT- BUT ADIDAS
NOTICES THAT IT IS A EVERY DAY
SO HAD MORE ABOUT BY THE WAY.
TOOK THE DATA. I LIKE THE LEG
THE NEWS ABOUT- ALL OF US LIKE
THAT COME. LIKE FOR OF WE CAN
WORK FROM HOME FOR A YEAR.
WITHOUT ANY CASH LIMP. SO
EVERYBODY HAS DIFFERENT SENSE.
TO DOWN OF PHYSICAL DOWNTIME
BEFORE THEY START IMPAIR CASTRO
VIEWS SURGEON EXCEED AND
PROBABILITY. AND ULTIMATELY COME
OF AS A YOUNG SCORE. I WANT TO
POINT OUT THAT WE'VE BUILT A
SCORE. FOR A BUSINESS AND THAT'S
WHAT WE DO WE'VE IT FOR A
AFFECTS THE WAY MOUNTED CHEMICAL
AND THOSE CAN OF PEOPLE. BUT AS
TIME YOU STARTED TO BE THIS FOR
THE GOVERNOR. OF THE GOVERNMENT
RESIDENTS IS DIFFERENT. RIGHT-
AS SO YOU KNOW AND IT'S AND SORT
OF. THAT THE GOVERNOR'S IS GOING
THROUGH COMPANIES LIKE SAFETY
WHICH IS ESSENTIALLY PEOPLE
SHOULD. YOU KNOW UP KNOW LOSE
THAT LIE AND A YOU KNOW YOU WE
DON'T ANY GUYS WERE. SECOND IS
THE WHOLE A LIVE AND THE TIME IT
TAKES TO THE TO THE- QUICKLY
WHETHER- YOU KNOW POWER FUNDS. A
ROTH AND OF THE TOTAL IS THE
CITY SHOULDN'T. ON ITS BONDS A-
AND WELL WHEN WE ARE TRYING TO
ME. OR WINDOWS OF AND JAPAN
AFTER TO MITIGATE THEIR
BASICALLY FITS OUT WHAT THOSE
KEY. ARE TODAY. FOR BOTH LIFE
SAFE- YOU KNOW IT TAKES TO
BECOME SOME TO MAKE LIFELINE. AS
WELL AS THE ECHO STANDING OF
CITY. THEN ONCE THEY DECIDE
WHERE THEY ARE TODAY UNVEILED
WANT TO BE THAT'S A SINCE ONE OF
THEM. WELL THIS IS ONE OF THE IS
THE LOST WITH THE SCHOOL. INVEST
ON. DID THEM AROUND ONSLOW
AGENDA RIGHT HE RAN ON THE FLOOR
HE WAS LIKE I WANT TO. GET YOU
GOTTA RIGHT THAT'S WHAT HIS. WAS
NO GONNA DIE. BECAUSE OF. IN
KUMAMOTO GOING FORWARD YOU LIKE
ZERO OKAY. INCOME WATER WHEN. SO
HIS ENTIRE MITIGATE. PLAN OR
BUDGET. IS BEING SPENT. NOT A
TERMS OF LIKE INITIAL ABILITY
FOR AND- BUT PRIMARILY IN TERMS
OF- PROVIDING LIKE- INCENTIVE
FOR HOME. TO A- AS WELL AS EVEN
. ROUTES AS WELL AS A WARNING
SYSTEMS BECAUSE THAT'S THE AND
THEN WE ARE ABLE TO OF MONITOR
THAT AND SEE OKAY IS HOW THESE
THE PLACE. THAT YOU CAN ACT. GET
YOUR K. BACKUP IN. YOU WILL HAVE
THAT TO. FOR DATA TYPE SUCH. ALL
FOR US TYPE. NOW IF YOUR WITH
ALL THE IN SHORT. RIGHT LIKE IF
YOU WERE TO. ON THAT THEN YOU
HAVE TO DO. A DIFFERENT DAY
OFTEN. OF THE RECOMMEND WOULD BE
DIFFERENT. BASED ON YOU KNOW
WHAT DOES KEEP. ARE AND ONE TO
BE. RIGHT SO IT'S- ABSOLUTE SO
THAT'S HOW SORT OF- THAT IS ONLY
MARLEY FRAME. LOOKS BIT V. BASIC
WANT TO UNDER. FROM OUR IN
COURTS APPLY OR WHOEVER LOOKING
WITH. SO WHAT WHAT DOES KPIS BE
AND THEN WE CAN MAKE THE
RELEVANT TECH. OF BRIDGE OF SEEM
WEAK BUT IF IT YOU KNOW IF IT
LEADS NOWHERE THEN THERE'S NO.
UP THE RATE. IS YOU DON'T LIKE
PARADISE OR PLACES. I ALREADY
YOU KNOW GREAT AFFECTED. IS THAT
IT IS. DOES IT MAKES TO SPEND A
LOT OF DEAD. IT'S KINDA LIKE.
REALLY DECIMATED BY FALLIS
PRETTY LOW IF. FILLING VALLEY
BANK LIKE THE SAFE BACK FOR. SO
IT'S ALREADY. SO WE TO BE VERY.
IN DATA DRIVEN IN TERMS OF. HOW
WE MAKE RECOMMENDATIONS. YOU
KNOW AS TO. THE MEDIA LIKE JUST
A- SOMEBODY CITY DOES NOT. HAVE
GONE DREIDELS SHOULDN'T.
SHOULDN'T BE NOT RECEIVING A SO
IT'S YOU NEED A MORE DAY DRIVEN
THE- AT THE STATE LEVEL. SO THAT
CAN- YOU KNOW UNDER HOW TO KEEP.
IN TERMS OF LIFE THE IN TERMS OF
ABILITY AND THEN WE SORT OF LIKE
OKAY. THESE ARE THAT I COME AND
IT COULD BE A ONE PIPE AND POWER
LINE IF- WHILE ONE IS MEDICARE.
EXCEPT WHAT I JUST WANT AND ALSO
- URGENCY- THAT'S- KIND OF POWER
DOWNTIME. OKAY WE HAVE. YEAH
WE'RE GOOD IS ONLY FOR A SECOND
. ALL RIGHT A GUESS OUR BACKUPS
DO HERE IN THE. SO THAT'S BIGGER
REVEREND GOT WE'RE MORE MINUTES
OF GET ON TO. A SO I WANTED TO I
JUST WANT TO- AND WITH-
THIS IS JUST LIKE A SCREEN GRAB
OF THE SYSTEM AND THE WAY IT
WORKS IS YOU KNOW THIS FACILITY
FOR INSTANCE- YOU CAN JUST PAUSE
IT- SO- BUT PERHAPS YOU CAN JUST
POSITIVELY BUOYANT OP SO.
ESSENTIALLY WHAT I'M TRYING TO
DEMONSTRATE HERE IS- YOU KNOW
AND THERE ARE A FEW MORE SLIDES
THAT YOU DON'T REALLY HAVE TIME
TO GET INTO BUT WE HAVE YOU KNOW
I'VE I WANTED TO SHOWCASE LIKE
FOR INSTANCE AN EXAM AS AN
EXAMPLE OF A FIRE STATION IN
MARIN COUNTY. WHICH IS A
COMPLETELY NEW- YOU KNOW BUT
IT'S GOING TO HAVE SEVEN DAYS A
POWER OUTAGE AND IT'S GOING TO
BE HAVING NO ACCESS FROM ONE ON
ONE IN IN A IN AN EARTHQUAKE
RIGHT SO ESSENTIALLY WE NEED TO
BE ABLE TO ACTUALLY MITIGATE. UP
IN A MORE SYSTEM WIDE HOLISTIC
FASHION SO THAT THESE SYSTEMS
THESE FIRE STATIONS- CAN
ACTUALLY PERFORM THEIR FUNCTION
DURING AN EMERGENCY SAME THING
WITH LIKE A STANFORD HOSPITAL
FUNDS AS THE WORLD'S SAFEST
BUILDING RIGHT IT CAN SURVIVE A
TWENTY FIVE HUNDRED YOUR- HIT.
THAT'S CORRECT BUT IF IT DOESN'T
HAVE WATER AFTER TWO DAYS ITS
OPERATING ROOM IS GOING TO BE
DYSFUNCTIONAL I AND- AND THAT'S
KIND OF YOU KNOW WE HAVE TO
THINK ABOUT THIS AT A SYSTEM
WIDE LEVEL AT A HOLISTIC LOW. SO
THANK YOU SO MUCH FOR HAVING ME.
ALL RIGHT THANK REFER
PRESENTATION OUR OPEN UP FOR
QUESTIONS- REBECCA. GOT A
QUESTION. THANK YOU SO MUCH I
WANT TO THANK THE CHAIRS FOR
WELCOME. YEAR COMMUNITY HEARING
IN HAVING. THIS IS- THE QUESTION
OF HOW MY CONSTITUENTS GET
COVERED FOR FIRE INSURANCE IS.
SOMETHING THEY THINK ABOUT ON A
DAILY BASIS- I REPRESENT MY
ENTIRE DISTRICT AS WELL INTERNET
OR FACE IN THE SPAN OF THE BAY
AREA AND- I REALLY APPRECIATED
THE PRESENTATION ON. AND THAT
YOU HAD ON CAST REMODELING. MY
NEIGHBORHOOD IS A FIREWISE
NEIGHBORHOOD WE ARE TAKING ALL
OF THOSE STEPS MY FIRE CHIEF IS
DONE INCREDIBLE WORK TO PUT-
SHOULD. YOU WERE EXTEND TO PUT-
SPRINKLER SYSTEMS THAT ARE
AUTOMATIC. OUT INTO THE- WILD
LAND SPACE SO THAT IF A FIRE
WERE TO START THERE WOULD BE
MITIGATION IMMEDIATELY. AND YET
WE CAN'T GET INSURED. AND THE
ANSWER TODAY IS- YOU KNOW THE
STATE PLAN. WELL WE TALK ABOUT
NOT ALLOWING FOR TEST REMODELING
BECAUSE IT WOULD RAISE RATES BUT
IF RIGHT NOW MY ENTIRE COMMUNITY
IS HAVING TO GO ON THE FAIR.
PLAN WHICH IS EXORBITANTLY
EXPENSIVE I GUESS MY QUERY IS WE
ALLOW FOR MY- THAT. THAT IT
KNOWLEDGE IS THERE A- THE MY
COMMUNITY FOR. ALL KNOWLEDGE AS
MANY FOR. THE THEY'RE TAKING.
AND THAT WILL HELP THEM- I MEAN
MY GOD TELLS ME IT WOULD BE
CHEAPER THAN THEM ALL GOING ON
THE FAIR PLAN. I ALSO DON'T
THINK THE FAIR PLAN CAN STAND UP
IF WE PUT EVERY SINGLE
CALIFORNIAN WHO'S AT RISK ON THE
FAIR PLAN. SO THAT'S A SEPARATE
ISSUE- BUT I GUESS THAT'S THE
QUESTION I'M TRYING TO ASK IS I
KNOW THAT MOST STATES ALLOW FOR
CATASTROPHE MODELING. AND WHERE
DOES THE IMPACT ON RATES RELATE
TO THE CURRENT COST OF FAIR PLAN
I ASSUME IT'S SOMEWHERE IN
BETWEEN CURRENT RATE THE FAIR
PLAN BUT I WANTED TO ASK THAT
QUESTION. DO YOU KNOW I'M SORRY
THE QUESTION ABOUT WHAT WOULD
HOW THIS AFFECTS RATES THE
CADASTRAMENTO THING. DO YOU KNOW
OR SHOULD WE SAY THAT THIS ALSO
ASKING I THINK IT'S GOING TO BE
ABLE. TO CASE BY CASE BASIS I
THINK I THINK YOU'RE YOUR POINT
IS WELL TAKEN SO YOU THERE'S-
TWO SIDES ARE GOING TO NEED
UNDER. SORT OF THE UNDERLYING
RISK AND THEN YOU ALSO NEED TO
UNDERSTAND. WHAT STEPS HAVE BEEN
TAKEN TO REDUCE THAT RISK
WHETHER IT'S SET UP HOMEOWNERS.
SITE OR AT A COMMUNITY LEVEL.
AND THAT'S WHERE. YOU KNOW THE
CATASTROPHE MODELS BECAUSE THEIR
DATA DRIVEN BECAUSE THEY CAN
TAKE ADVANTAGE OF NEW DATA AND
ITERATE OVER TIME GRADUALLY
IMPROVE. THE VIEW OF REST THAT
THAT COMES OUT THAT'S WHERE THE
MODELS CAN BE VERY HELPFUL. IN
THE IN THE STAFF TO JUDITH. IN
TERMS OF THE MID. FOR APPLE IS
NOT INCLUDED IN HAS TO. DATA
IT'S A REALLY THE MODEL HELPS.
AUG THE HISTORICAL DATA. WHAT
BECAUSE OF THE DATA DRIVEN. AT
ANY. THAT WHEN YOU. THE HAS.
DATA THAT SAME DAY. NEIGHBOR ONE
OF THINGS I LEARNED FROM MY FIRE
CHIEF TELLS ME THAT I'M IN. YOU
KNOW DON'T LIVE IN THE RIGHT
PLACE. I IS. YOU KNOW THINGS
LIKE ROADS ALSO CHANGED. THE
FIRE REYES SAID THERE WERE YOU
HAD NO ROADS BECAUSE THERE WAS
NO COMMUNITY. THERE'S MORE
HOUSES BUT YOUR RISK ALSO
CHANGES FOR HOW FAR THAT WILL GO
WITH NATURAL FUEL BREAKS THAT
ARE BUILT INTO COMMUNITIES. SO I
DON'T THINK GREAT HISTORICAL
DATA IS REALLY PROBLEMATIC
BECAUSE THERE'S SO MANY FACTORS
THAT CHANGE. AS REBUILDS
COMMUNITIES- AND SO I JUST
WANTED TO BE HERE TO REALLY
THINK THE CHAIRS FOR. I'M
HOLDING THIS HEARING FOR HAVING
THIS CONVERSATION I KNOW MY
COMMUNITIES EAGER. PRESS TO HAVE
A MARKET PLACE THAT DOES IT
KNOWLEDGE THE RISK THAT THEY
FACE BUT ALSO ALLOWS FOR THEM TO
LIVE IN THE COMMUNITY THAT THEY
LOVE SO MUCH. THANK YOU. I THINK
THAT SORT. SO I THE ONE THING TO
SORT OF- IT. MOST OF. WHAT THE
THAT IS THAT IS THE LIMITED.
AVAILABLE FOR BY FIRE- IF ANY
THE **** OUT OF. MOST ROUTINE
FOR A COUPLE OF THE- FOOTBALL
OUT OF. WIFI JUST. I MEAN
OBVIOUSLY THESE AND- ARE PROVIDE
. INSURANCE OTHERS. WHILE
FIGHTING. AND PROBABLY SO. STATE
BUT THEY ARE. IT ON THEIR OWN.
SO IT'S- SO IMPORTANT TO SEND
THAT. THE OTHER IS WHY FIRE RISK
IS NOT EATING. THE SAME AS- YOU
KNOW FLOOD RISK WHAT ARE
QUICKEST. EIGHT A IT'S A THERE'S
NO. ACTS WIFI RISK MAP RIGHT NOW
IN THE WORD. RIGHT BECAUSE THIS
A DYNAMIC MATH YOUR HOPE IT
NEEDS TO BE. YOU NEED TO BE
CHANGING GOING. TO MITIGATE.
RIGHT LIKE IF NOT HE SAID HAVE
MORE GOING ELSE IF YOU DO TO BE
J. FLOOD RISK AND- RISK MORE TO
THE DINO. RIGHT BY FIVE
MITIGATIONS SIMILAR. I LIKE TO
ONE DOLLAR GIVES YOU BACK FOR.
OR DOLLARS A DEBATE THE OTHER
SIDE BUT THE THAT'S WHEN ACTUAL
EARTHQUAKES. THAT WOULD BE ONE
OF LET ME THEN YEAR OF A LOOK AT
COULD BE HUNDRED IN A DIFFERENT
FOR BY FIRED. LIKE YOU NEED TO
SPEND THAT ONE DOLLAR PER EVERY
OTHER YEAR. RIGHT SO MY POINT IN
SAYING THIS. A.
ALL PRICING- ANYWAYS BECAUSE THE
MODELS ARE NOT THAT GRANULAR-
YOU'RE GOING TO SEE VERY BLOODY-
MODELS FOR WIFI AT RISK AND SOLD
WILL THE SO THE MITIGATIONS BEEN
LOCKED BE A REFLECTIVE OF LIKE
OKAY YOU DID THIS. SO YOU'RE
GOING TO. SUDDENLY HAVE A
REDUCED RATE THAT'S NOT GOING TO
BE NECESSARILY LIKE DEFINITELY
CHANGE THE RATES FOR THE ENTIRE
STATE OBVIOUSLY IT MIGHT REFLECT
FOR CERTAIN COMMUNITIES BUT-
IT'S YOU KNOW THE SCIENCE IS NOT
OF IT IT IS FAR UNDERSTANDING
EARTHQUAKES OR FLOODS I CAN
CERTAINLY GO INTO MORE DETAIL
BUT- SO I GUESS I WOULD JUST I
MEAN THAT PRESENTATION YOU HAD
REFLECTED THAT MITIGATION SO I
ASSUME IT DOES TAKE INTO ACCOUNT
YOUR CAST REMODELING MEDICATION
IS THAT NOT. TRUE THE REQUESTED
FOR ME YES SORRY BECAUSE HE'S
SAYING THAT YOU WOULDN'T BE ABLE
TO TAKE THIS MEDICATION THAT ARE
OUT WELL BECAUSE YOU GET YOUR
POINT ISSUED IF YOU BREAK THESE
MAINTAINED RIGHT I THINK THAT'S
YOUR POINT RIGHT IN PLACE THE
PARAMETERS THAT WE NOW HAVE
ORDINANCES IN MY CITIES YOU HAVE
TO HAVE THIS PURPOSE FROM HOME
SO IT'S NO LONGER OPTIONAL IT'S
NOW THE LAW. AND BECAUSE OF OUR
RISK AND SO I GUESS LIKE WHERE
WE HAVE THOSE LAWS ON THE BOOKS
I WOULD ASSUME YOU'D BE ABLE TO
TAKE THAT INTO ACCOUNT BECAUSE
NOW YOU KNOW OUR FIRE CHIEF HE
WAS OUT DRIVE NEIGHBORHOOD THE
OTHER DAY- SO YOU KNOW THAT
WE'RE MAINTAINING THOSE
MITIGATION STANDARDS AND
HOPEFULLY THAT WOULD BE
REFLECTED IN RATES. YEAH I WOULD
SAY TWO THINGS THAT IT'S AT. THE
YES THE SHORT ANSWER IS YES THE
MEDICATION WOULD BE REFLECTED
I'D I'D MAKE THE POINT THAT
THERE'S- A LEVEL OF MITIGATION
THAT CAN OCCUR AT THE PROPERTY.
LEVEL LIKE FOR EXAMPLE
DEFENSIBLE SPACE THEY CAN HAVE
AN IMPACT. BUT THERE'S ALSO. IN
CASES MAYBE MORE AND- LEVEL
AMID. THAT AT THE COMMUNITY
LEVEL THAT PREVENTS THE FIRES
FROM GETTING INTO THE
COMMUNITIES IN THE FIRST PLACE
SO THAT THEY BOTH GO HAND IN
HAND BUT AND AGAIN AS YOU. THE
FRAMEWORK YOU DISK WE DESCRIBED
IS A DATA DRIVEN FRAMEWORK
CHOICE THESE. AS THIS
INFORMATION BECOMES AVAILABLE
SORT OF A KEY PROCESS HERE IS
LET'S. CAPTURE THAT DATA LET'S
MAKE IT AVAILABLE SO THAT. IT
CAN MAKE ITS WAY INTO THE MODELS
AND GRADUALLY OVER TIME TO
IMPROVE. IMPROVE THE MODELS AND
THAT THAT LEAVES YOU JUST BETTER
OUTCOMES I THINK IN THE LONG RUN
. OKAY UP. PLEDGE OF CHRISTIAN.
DID THANK YOU SO MUCH REALLY
APPRECIATE THIS HEARING IN. THE
CHAIRS RIGHT TOGETHER AND- THIS
IS A HUGE ISSUE IN MY COMMUNITY
AS WELL I REPRESENTS SAN
FERNANDO VALLEY IN SANTA CLARITA
VALLEY BOTH SURROUNDED BY.
MOUNTAINS AND HILLS- AND LOTS OF
BRUSH AND IN MY COMMUNITY.
SPECIFICALLY WE'VE BEEN VERY
HEAVY HAVE BY THIS ISSUE I LIVE
IN A- CONDO COMMUNITY OF OVER
SEVEN HUNDRED UNITS. WE GOT
DROPPED FROM OUR A FIRE
INSURANCE A FEW YEARS AGO- HAD
TO GET COULDN'T GET INSURANCE
THING GOT CATASTROPHIC INSURANCE
WHICH IS WILDLY EXPENSIVE- HAVE
HAD MULTIPLE THOUSAND DOLLAR
ASSESSMENTS. ON OUR UNITS AND-
THEY REYES ARE EACH ALWAYS TWO
HUNDRED DOLLARS A MONTH ON TOP
OF THAT. SO WE HAVE YOU KNOW
SENIORS IN OUR COMMUNITY WITH
FIXED INCOMES I DON'T KNOW HOW
PEOPLE ARE FORTY AT- AND YOU
KNOW IT'S A HUGE HUGE ISSUE. N.
SO I'M TRYING TO UNDERSTAND
PRACTICALLY HOW CATASTROPHE
MODELING WORKS LIKE IN OUR
COMMUNITY. IT IS GUARANTEED THAT
THERE WILL BE FIRES IN THE HILLS
AROUND MY NEIGHBORHOOD EVERY
SINGLE YEAR A HUNDRED PERCENT.
HOWEVER IN THE SIXTY YEARS THAT
OUR COMMUNITY HAS BEEN THERE
ARE. NONE OF THE BUILDINGS HAVE
EVER BURNED FROM A FIRE RIGHT
THEY'VE ALWAYS BEEN ABLE TO GET
IT OUT THE FIRE DEPARTMENT IS
CLOSE ENOUGH XCERRA. SO HOW LIKE
HOW I KNOW YOU CAN'T. DO ON THE
SPOT MODELING FOR MY
NEIGHBORHOOD BUT- BUT JUST KIND
OF TRYING CAN YOU WALK ME
THROUGH HOW CATASTROPHE MODELING
WOULD WOULD WORK IN THIS
INSTANCE BECAUSE- I. AM NOT SURE
IF IT WOULD BE BETTER FOR OUR
COMMUNITY OR WORSE FOR OUR
COMMUNITY- AND HOW THOSE KIND OF
PLAYS OUT- YEAH I THINK THAT THE
SHORT ANSWER WOULD BE- SO I
MENTIONED IN ONE OF MY SLIDES I
USE THIS TERM URBANISED CITY.
WHICH I'M NOT SURE THE WORD BUT
IT BASICALLY MEANS TRYING TO
UNDERSTAND WHAT SORT OF THE LAND
USE- IN AND AROUND THE PERIMETER
OF THE FIRE ONE OF THE THINGS
THAT YOU SEE WHEN YOU LOOK AT
HISTORICAL BURN SCARS- IS IT YOU
DO SEE THESE POCKETS WHERE. YOU
HAVE A FIRE THE DANCERS TO A
POINT AND THEN IT STOPS IN
GENERAL IT'S BECAUSE OF. OF FIRE
SUPPRESSION EFFORTS THAT'S ONE
OF THE THINGS THAT WE TRY AND
CAPTURE. IN OUR MODELS AS WE'RE
PROPAGATING THE FIERY
RECOGNIZING IN THAT SORT OF
SIMULATION PROCESS WHERE YOU GET
INTO A DIFFERENT LAND USE WHAT
YOU'VE GOT MORE URBAN POPULATION
SO THAT YOU THEN PRESUME SOME
LEVEL. OF FIRE SUPPRESSION TO
PROTECT THOSE AREAS SO THAT'S
GENERALLY HOW WE DO IT- I'LL SAY
THAT IT'S A TRICKY PROCESS
BECAUSE IT'S NOT STRICTLY DRIVEN
BY- YOU KNOW BY JUST THE PHYSICS
OF. THE WILDFIRE RATED NOW WE'RE
ALSO TRYING TO MODEL SORT OF THE
HUMAN BEHAVIOR. SO BACK AGAIN
GOES BACK TO THE DATA AND JUST
HAVING A BETTER UNDERSTANDING OF
THE WHILE FOR OF THE
FIREFIGHTING CAPABILITIES IN
COMMUNITIES AND- BUILDING THAT
IN. TO THE MODELS THAT'S
GENERALLY THE APPROACH IS THAT
WE DO RECOGNIZE THE FIRE
SUPPRESSION. HAPPENS IN THIS
PART OF THE- PART OF THE
OUTCOME. OF THE SIMULATED EVENTS
AND SO WE REALLY ARE. LOOKING
FOR WAYS OR HAVE INCORPORATED
WASTE ALWAYS LOOKING TO IMPROVE
WAYS TO MAKE THAT MORE MORE
ROBUST AS WE- DEVELOP THESE
VIEWS OF RISK. FROM JIM YOU HAD
A QUESTION. YEAH FIRST OFF THANK
YOU APPRECIATE THIS AND I. VERY
MUCH APPRECIATE DATA DRIVEN
MODELS- AS WE AS WE TRY TO
ASSESS RISKS AND- I'M
DISAPPOINTED THAT THAT THAT
THESE CAST CONTEST BECAUSE
TRAFFIC CATASTROPHE MODELS ARE
NOT. ALLOWED BY LAW HERE IN
CALIFORNIA. SO I DO THINK OVER
TIME WITH THE PROPER DATA WE
MIGHT BE ABLE TO GET TO A POINT
WHERE INSURERS INSTEAD OF USING
A CHAINSAW CAN USE A SCALPEL.
AND HOW THEY CARVE UP YEAH I'M
AREAS BASED ON RISK BECAUSE
RIGHT NOW- FOR EXAMPLE I'VE EVER
MET A MAN WHO IS IN HIS OWN END
HE'S RIGHT ON THE COAST YOU CAN
SEE THE OCEAN FROM HIS. FROM HIS
END. YEAH HE'S CONSIDERED BY
INSURANCE COMPANY A SUPER HIGH
RISK EVEN THOUGH. OFTENTIMES
WHEN HE'S IN THE MORNING HE'S
GOT RAINY. BIT BUT HE HAS FOREST
AROUND HIM AND SO IF THERE WAS
COULD YOU KNOW KICK CATASTROPHE
MODEL THAT SHOWED HEY THIS ISN'T
REALLY A HIGH RISK AREA HE MIGHT
ACTUALLY BE ABLE TO AFFORD
INSURANCE FOR HIS IN- AND I ALSO
. IN ITS- A FOURTEEN- IN MY
DISTRICT- THEN SECRETARY. OF
NATURIST HERS JOHN LAYERED WAS
AT THE COYOTE DAM IN MENDOCINO
COUNTY- IN FEBRUARY AND THE ARMY
CORPS OF ENGINEERS WAS RELEASING
WATER. YEAH THEY WERE RELEASING
WATER BECAUSE THEY HAD A BOOK.
THAT SAID ON THIS DATE. IF
THERE'S THIS MUCH WATER. YOU
SHOULD BE RELEASING WATER THE
PROBLEM IS. THERE WAS NO MORE
RAIN THAT YEAR. AND SO WE
RELEASED A BUNCH OF WHY THAT
DIDN'T NEED TO BE RELEASED. FAST
FORWARD WE'RE NOW USING
ATMOSPHERIC RIVER RESEARCH DATA
TO BE ABLE TO PREDICT WHEN WE
SHOULD BE RELEASING A WIN WE
SHOULD NOT BE RELEASING WATER
OTHERWISE. WE'D STILL BE BACK
RELEASING WATER AT THE WRONG
TIME OF THE YEAR. SO THE IDEA
THAT WE AS A STATE. CANNOT GET
OUR ARMS AROUND YOU TO USING. A
CATASTROPHE MODELING. IS
RIDICULOUS IT FROM MY
PERSPECTIVE AND SO- SO THANK YOU
FOR BEING HERE AND I HOPE THAT
AT SOME POINT WE CAN CHANGE THE
LAW. THANK YOU THAT THE CAMERA
GIPSON QUESTION THANK YOU VERY
MUCH I WANT TO SAY THANK YOU TO.
CHAIRWOMAN CALDERON AND ALSO
YOURSELF- CHAIRMAN RODRIGUEZ
WILL BRING US ALL TOGETHER TO
ADDRESS THIS VERY IMPORTANT
TOPIC THAT'S BEFORE US- I DON'T
REPRESENTS A WILDFIRE AREA I
REPRESENT WATCH. COMPTON CARSON
WILMINGTON NORTH LONG BEACH
HARBOR GATEWAY HARBOR CITY-
WILMINGTON AND SAMPEDRO- WE
DON'T HAVE THIS BUT IT'S ALL OF
OUR PROBLEM IN THE STATE OF
CALIFORNIA. AND SO WITH THAT
BEING SAID ACCOUNT OF THE
CATASTROPHIC MODELING IS
CRITICAL TO REFLECT THE REAL
RISK INSURERS ARE FACING IN THE
STATE OF CALIFORNIA- BUT FROM
WHAT I'VE HEARD- IT IS ONE PIECE
OF A LARGER FIX- IN THIS HUGE
DYNAMIC. OF THE INABILITY TO
INCLUDE REINSURERS IN THE COSTS
AND THE DELAY IN THE PROCESSING
TIME. ALSO NEEDS TO BE
ADDRESSED. IT NEEDS TO BE
ADDRESSED AS I SAY I NEED NEEDS
TO BE ADDRESSED IT NEEDS TO BE
ADDRESSED- AND ARE THE
DEPARTMENT OF INSURANCE AND- THE
PART OF INSURANCE AND INSURERS.
I'M COMMITTED TO WORKING TO
REMAINING THIS SITUATION- THAT
WE ARE FACED WITH BECAUSE IT IS
JUNE TO GET WORSE AND SO THAT'S
MY QUESTION BECAUSE AGAIN ALL OF
CALIFORNIA- WHERE DO YOU LIVE IN
A WILDFIRE AREA AND NOT ALL OF
US ARE IN THIS THING TOGETHER.
AND WE'RE SEEING THEIR RIPPLE
EFFECTS BY. INSURANCE COMPANIES
NOT WRITING INSURANCE MOVING
FORWARD SO IF YOU CAN ADDRESS
THAT THAT I MAY HAVE A FOLLOW UP
QUESTION APPEARS IN YOUR
RESPONSE TO THAT QUESTION- SO I
THE- IS- PROCESSING TIME. YEP
PROCESSING TIME FOR REINSURANCE
KING WELL SO I GUESS IS YOU SAID
THERE JUDGE WHAT'S HIS RECORD
MAYBE THAT'D BE A GOOD PANEL A
GOOD COURSE FOR THE NEXT PANEL
GUARD INSURANCE MAYBE YOU THINK
JUST. I THINK SO MAYBE BUT IF
YOU WANT TO TAKE BOTTOM OUT REAL
QUICK I DON'T. JOE JUST THINKING
. RUSSIAN BUT- I GUESS IS THAT
IT'S YEAH BUT OKAY MASSES
QUESTIONS QUICK WHAT HAVE NOT AS
YOU THAT YOU LEAVE WITH US
BEFORE LEAVE- NO I THINK YEAH
THAT'S A QUESTION I THINK- DOT I
THINK I THINK YOU GOT. IT IS THE
BACK DURING- DOCUMENT I THINK
DID VERY WELL I THINK IT WAS A
PRETTY GOOD X. I FEEL YOU'VE GOT
A GOOD UNDERSTANDING I THINK THE
- HOW DO YOU BALANCE. YOU KNOW
THE IN AND SORT OF INTRODUCE
THIS CHANGE WHICH IS ALL HARD TO
DO OVER AND I THAT'S THE-
PROBABLY THE FUNDAMENTAL ISSUE
AYE MAYBE NOT US IT'S SO MUCH
ABOUT THE SIGNS WITH A OFTEN.
THESE PROBLEMS AREN'T ABOUT THE
SCIENCE OF TECHNOLOGY IT'S ABOUT
. YOU KNOW HOW IF PEOPLE THAT
FACE BUT IT'S NOT A MATH PROBLEM
IS A PROBLEM THINK. I AGREE A
100% I DON'T THINK THIS IS. NOT
5% A CAST MARLEY PROBLEM- YOU
KNOW OBVIOUSLY. HE THAT THAT
SCIENCE EXISTED FOR SOMETIME
RIGHT LIKE SO YOU. SO I THINK
THAT CAN BE INCORPORATED LIKE IT
CAN BE IT MAKE MORE DYNAMIC
PROCESS. ESPECIALLY- I THINK
THERE NEEDS TO BE A SINGLE
SOURCE OF TRUTH FOR WHAT
MEDICATIONS ARE BEING DONE AND-
LIKE IT NEEDS TO BE LIKE A CLOUD
OF AUDITABLE. DATABASE BECAUSE
INSURANCE COMPANIES DON'T HAVE
THE MEANS TO BE AUDITING THAT
THEY MAKE 34% OF YOUR SELECT THE
DATE. THAT THAT NEEDS TO BE A
MECHANISM FOR PEOPLE TO ACTUALLY
SORT OF SAY THIS IS WHAT I HAVE
DONE IN TERMS OF MITIGATION AND
I CONTINUED DOING THAT WONDERFUL
FOR THE COMMUNITY FOR THESE FIVE
ICE COMMUNITIES ONCE INSIDE. SO
ALL OF THAT- BUT- I JUST WANT
YOU GUYS WOULD ONE PART- MAY NOT
. BE POPULAR IN THIS THIS COMEDY
BUT BUT- OBVIOUSLY IT
INTRODUCING. THE- ENTERED INTO
INTRODUCING COCONUT MODELING
URGING RIGHT LIKE A FOOT FOR
THIS ABOUT WE TALK MITIGATE. WE
SHOULDN'T JUST BE LOOKING AT THE
DECK. TOP OF MIND ISSUE RIGHT
LIKE O. ALL YOU KNOW JUST WIFI.
OR JUST OR WE HAVE TO BE AT IT
FROM A VERY COLD. FASHION
BECAUSE THE NAY EVENT OR THE
NEXT OTHER IS NOT GONNA BE. YOU
KNOW STATE FARM. A THAT THEY'RE
NOT GOING PROVIDE A IS GOING TO
BE COMPANY SOMETHING. AND SO WE
JUST WANT TO HAVE HOLD. DATA
DRIVEN OF. ACROSS HAZARDS ACROSS
ALL THESE DEPENDENCIES ACROSS
ALL OUR KPIS OFF BALANCING OUT
LIFE SAFETY IN SHORT ABILITY
ECONOMIC IMPACT. AND ALL OF THAT
SO. YEAH OKAY THANK YOU ONE NEXT
QUESTION PROGRAM THAT ON WHAT.
THANK YOU SOME. QUESTION FOR THE
WITNESSES I WE'RE GOING TO HEAR
INSTANT OF INSURANCE NECK ONE OF
THEIR CONCERN THAT THEY BELIEVE
THAT- THE MODELING THAT WOULD BE
USE THE SOFTWARE SHOULD BE MADE
ACCESSIBLE. AND SHOULD BE
TRANSFERRED TO THE PUBLIC. I
UNDERSTAND THAT RAISES OBVIOUS
PROPRIETARY TRADE. SECRET ISSUES
ON YOUR AND MY QUESTION IS HOW
HAS THIS BEEN HANDLED IN OTHER
STATES THE ISSUE OF. BEING ABLE
TO EXAMINE. WHAT GOES INTO THE
SMALLING'S TO MAKE SURE IT IS
FAIR. AND SCIENTIFICALLY SOUND
WITHOUT GIVING AWAY YOUR TRADE
SECRETS YEAH GOOD QUESTION SO-
COUPLE THINGS THAT THAT THAT WE
DO- IS COMPANIES SO ONE IS THAT-
WE- MAKE OUR DOCUMENTATION OR
FROM ALL DOCUMENTATION
AVAILABLE- TO THE DEPARTMENT OF
INSURANCE AND BASICALLY
AVAILABLE PUBLICLY SO FOR
SOMEONE WANTS TO LOOK AT FOR
EXAMPLE THE WILDFIRE.
DOCUMENTATION AT THE HUNDRED
PAGE DOCUMENT THAT DESCRIBES.
THE TOOLS AND DATA THAT THEY
WERE USING- IN TERMS OF HOW
OTHER STATES DO. ADDRESS THE
ISSUE SO THERE'S A COUPLE
DIFFERENT APPROACHES ONE. IS
SORT OF THE DEPARTMENT WILL
HANDLE SAID HAVE BEEN
INTERROGATORIES AND JUST SORT OF
INTERPRETING OR OR SORT OF
QUESTIONING- ASPECTS OF THE
MODEL IN SOME BACK AND FORTH
WHERE WILL TO EXPLAIN TO THE
MODEL TO THE- DEPARTMENT ABOUT
HOW THEM THE MODEL WORKS- IN
OTHER CASES THERE IS A THIRD
PARTY. THAT WOULD WOULD EVALUATE
THE MODELS AND PROVIDE- YEAH I
VALUE AT THE MODEL AGAINST A SET
OF STANDARDS IN AND DETERMINE
WHETHER OR NOT THE MODEL MEETS
THOSE STANDARDS AND MAKE THE
MODELS AVAILABLE NOT HUESO VERY
STUPID YEARS THERE YOU WOULD BE
WILLING- YOU GUYS TO MAKE. IT
AVAILABLE THE MODELING TO THIRD
PARTIES OR EVEN THE DEPARTMENT
OF INSURANCE. TO EXAMINE THE
SOFTWARE. WE'D BE OPEN TO. BOB
OF DIFFERENT WAYS WE COULD YOU
TO MOVE THIS. SO WE HAVE WE DO
AS YOU SAY WE YOU KNOW IS
IMPORTANT PROTECT OUR I. P. BUT
THERE'S LOTS OF WAYS TO. GET
AROUND THAT THERE IS THE SPACE
OF A YUBA. A HAZARD A CAST MODEL
- THIS IS YOU KNOW THE IS A VERY
SMALL PROBLEM BELIEVE ME THAT IS
A BOTTOMS UP VIA VIDEO.
EXPORTERS OF X. THROUGH A WE
HAVE A TECH WORK GROUP COMPOSED
OF PROFESSORS FROM STANFORD
BERKELEY ALL THOSE. PEOPLE AND
ALSO IN JAPAN JAPANESE
PROFESSORS SO WE THEY APPROVE
OUR MODEL SO THAT'S A BOTTOMS UP
AND THEN. DROP DOWN YOU
BASICALLY HAVE TO BE SCRUTINIZED
BY THE SIDE OF LET'S SAY THE
DEPARTMENT INSURANCE. IT'LL BE
LIKE HOW DID MODEL PER FARM BACK
TESTED HARLEM AUDIBLE FARM IN
BATTERED. OR IN. NOW IN THIS
WIFI HOURS ARE MOSTLY. SO THAT'S
AND THEN YOU HAVE TO STAY BUT
PUBLISH ALL OF THE- ARE YOU NOT
PUT. MODERN I HAVE YOU START
THESE CON. WITH THE- INSURANCE
OF STARTED LOOKING AT YOUR.
MODELS ARE NOT YET. I THINK IT
R. K. I HAVE- IN. THE FIVE YEARS
I A CURFEW. WITH I THINK THEY
HAVE A RECENTLY. OF OR MODELS
WORK YEP WE TO GET INTO THE
SPECIFICS A REVIEW. OR ALL RIGHT
THANK YOU THANK YOU. OKAY THANKS
VERY MUCH FOR THE FIRST POWER NO
MORE ON TOWARDS. DOWN SECOND
PASS UTILIZATION. CATASTROPHIC
MODEL. FIRST WE HEAR FROM RYAN.
DEB DIRECTOR FIRST AND
CALIFORNIA OFF OF MACHINE. THE
REQUESTED QUICKER. AND ALSO
BRING EVERY ELSE OF ALSO HAVE
BEEN POMEROY. CHICKEN CHIEF ROB
FROM CO EARTH AT THE- AND WILL
HAVE LYNN VAUGHAN KNOCKED
HOPEFULLY GOT THE WRITE
EXECUTIVE DIRECTOR STRATEGIC
GROWTH COUNCIL. AND WILL HAVE
MIKE PETERSON DEPUTY
COMMISSIONER FOR THE CLIMATE AND
SUSTAINABILITY. FROM CALIFORNIA
DEPARTMENT RECURRENCE AND WILL
HAVE LUCY **** DEPUTY
COMMISSIONER FROM THE SPECIAL
COUNSEL CALIFORNIA DEPARTMENT OF
INSURANCE. SO WITH THAT WE'LL GO
ON WITH RYAN WHEN YOU'RE READY.
FIRST OFF MIGHT. TESTIFY SAYS
GOODBYE AFTER IT'S GOOD MORE-
CHAIR RHETORIC AND CHAIR
CALDERON AND- MEMBERS OF. THE
COMMITTEES MY NAME IS RYAN
PURISTS AND THE DEPUTY- FOR
RECOVERY OPERATION AT THE
GOVERNOR OFFICE OF SERVICES. OUR
MISSION AS YOU KNOW I CAN ****
PROTECT LAW AND- THE OKAY SINCE
THE OUR CAN. OUR FROM OUR-
CALIFORNIA. HELLO YES PRINCIPLE
WAS INCLUDED. OF ALL THE STATE
DISASTER. EMERGENCY PLANNING
PREPARE NOW. AND AS RECOVERY
MITIGATE AND ALL LANCE.
ACTIVITIES FOR STATE LEVEL
OPERATION MODELING JOURNAL YOU
TO CARRY SIZED AND RISK. KELLY
AS YOU TO LIE MODELING EFFORTS
BY PARTNER TO SUPPORT PLANNING
FOR HAZARDS THAT HAVE THE
POTENTIAL TO IMPACT LARGE AREAS
OF CALIFORNIAN OVER RALPH
OVERWHELM LOCAL. AND STATE
CAPABILITIES FOR EXAMPLE- THIS-
THE S. AND EVERYONE IMPACTS USE
IN THE MOST RECENT PLANNING
EFFORT TO TWENTY TWENTY TWO
SOUTHERN CALIFORNIA CATASTROPHIC
EARTHQUAKE PLAN. REFLECT THE IN
DEPTH ANALYSIS AND OF MODELS
INTO SUCH AS THE UNIFORM
CALIFORNIA RUPTURE FORECAST IN
FEMA'S STANDARDIZES THE PRESS
THE MAIN RISK FROM DISASTERS AND
THE HAS THIS PROGRAM YOU MUST
HAVE THIS PROGRAM PROVIDES A
STANDARDIZED TOOLS. AND DATA FOR
ESTIMATING RISK FOR OUR FROM
EARTHQUAKES FLOODS TSUNAMIS AND
HURRICANES RISK ASSESSMENT
RESOURCES FROM THIS PROGRAM ARE
ALWAYS FREELY AVAILABLE AND
TRANSPARENT- TRANSPARENTLY
DEVELOPS. THE MCALARY US IN
LOCAL PARTNERS UTILIZE DATA. ARE
GENERATED THROUGH HAS THIS
MODELING. TO ESTIMATE THE
IMPACTS OF DISASTER. DURING THE
PLAN OF SO THAT RESOURCE
REQUIREMENTS GAPS. CAN BE
UTILIZED ADDITIONALLY THE
LOCATION AND FLOOD HAZARDS
IDENTIFIED IN THE NORTHERN CARE-
CALIFORNIA CATASTROPHIC FLOOD
RESPONSE PLAN. OR THE OR THE
FLOOD INSURANCE RATE MAP
FLOODPLAINS PART OF A NATIONAL
INSURANCE SYSTEM MAINTAINED
UNDER THE NATIONAL FLOOD
INSURANCE PROGRAM AND FIP.
DURING THE TRANSITION FROM
RESPONSE TO RECOVERY WE FOUND
DURING RECENT FLOOD EVENTS- THAT
SOME OF THE HARDEST HIT AREAS
WEREN'T ASKING. FOR ASSISTANCE
QUICKLY ENOUGH BECAUSE THEY WERE
SO HEAVILY IMPACTED BY THE EVENT
CALLOW YES IN COORDINATION WITH
FEMA. USES UP THE SYNTHETIC
APERTURE RADAR SORE- OUR DATA
FROM THE ICY FLOOD. INSIGHT
PRODUCT TO IDENTIFY. THESE
LOCATIONS AND TO ENSURE THAT OUR
AREAS WHERE SIGNIFICANT FLOODING
WAS PROJECTED YOU YOU ARE USING
THIS MODEL WERE INSPECTED FOR
POTENTIAL. IMPACTS THE STATE
ALLOWED US TO IDENTIFY AREAS
WHERE WE WHETHER HE WAS GREAT-
BUT DISABILITY FOR COMMUNITIES
TO REACH OUT TO US FOR HELP WAS
LIMITED. AND WE WERE ABLE TO
ENSURE PRELIMINARY DAMAGE
ASSESSMENTS WERE COMPLETED AS
QUICKLY AS POSSIBLE SORRY IS A
REMOTE SENSING TECHNOLOGY. THAT
UTILIZES RADAR SIGNALS TO GATHER
INFORMATION ABOUT THAT OUR
SURFACE AND HAS RECENTLY PROVEN
TO BE A VALUABLE TOOL FOR
EMERGENCY MANAGERS TO UNDERSTAND
FLOOD DEPTH- IN THE EXTENT
DURING DISASTER RESPONSE. BY
ACQUIRING STAR DATA AT REGULAR
INTERVALS DURING THE RECENT
FLOODING OF AT FEMA TRACK
CHANGES AND FLOOD EXTENTS IS
ACTUALLY INCLUDED THE DEPTH OF
THE WATER AT EACH PARCEL. NOT
ONLY GOOD FEMA DETERMINE WHAT
STRUCTURES WERE IN OR NEAR THE-
ZONE OF THREAT THEY WERE ABLE TO
TALK ABOUT THE FLOOD STRUCTURE.
WAS LIKELY A SUPPOSED TO THE
STATE AIDED UNDERSTANDING THE
PROGRESSION OF FLOOD. IDENTIFIED
EVERY IS ARRESTED FOR THE
INNOVATION- AND IT ALSO HELPED
US WITH THE ADVANCE PLANNING SO
WE CAN. MOVE RESOURCES TO THOSE
IN MOST NEED. HELLO YES I ALSO
USE DATA FROM THE TWENTY TWENTY
TO EZRI. MARKET POTENTIAL DATA
SAID TO SUPPORT I REQUEST FOR
THE PRESIDENTIAL DECLARED
DISASTER THE INSURANCE DATA
PLAYS A CRITICAL ROLE. IN
EVALUATING A COUNTIES RECOVERY.
POTENTIAL FROM A DISASTER. I AT
BOTH THE COUNTY AND IT CODE
LEVEL- IT PROVIDES VALUABLE
INSIGHTS INTO THE LEVEL OF
COVERAGE WITHIN THE COUNTY
HELPING US UNDERSTAND THE EXTENT
OF HOW PREPARE THE COMMUNITY.
FOR THE FRONT OF THE EARTHQUAKE
AND SUBSEQUENT EVENTS WE HAVE
UTILIZED AS WE MARKET FOR- OF
POTENTIAL DATA SET WHICH
INCLUDES THE VARIABLES QUOTES
HAVE ANY HOMEOWNERS OR PERSONAL
PROPERTY INSURANCE IN QUOTE IN
QUOTE. HAVE HORMONE HAVE HOME
INSURANCE COVERAGE FOR
EARTHQUAKE OR FLOOD. IN QUOTES.
SEVERAL LOCAL STATE AND FEDERAL
HAZARD MITIGATION SYSTEM
PROGRAMS USE MADELINE. AS A
FACTOR THAT DETERMINES WHETHER
GRANT PROJECT- IS ELIGIBLE ARE
NOT. IT IS NOT USED TO RANK OR
SCORE PROJECTS- IN ADDITION TO
THE HAS THIS PROGRAM THE MAIN
MODELING TOOLS USED FOR HAZARD
MITIGATION EFFORTS INCLUDE THE
FAME OF BENEFIT COST ANALYSIS
BCA. TOOK FEMA REQUIRES THAT ALL
HAZARD MITIGATION PROJECTS MUST
DEMONSTRATE. THAT BENEFITS WILL
OUTWEIGH COST IN THE FILM
APPROVED METHODOLOGY USED IN THE
FILM- BENEFIT COST ANALYSIS TO
CATS. I AS I STATED EARLIER
MODELING DURING THIS PROCESS IS
ONLY USED TO VERIFY ELIGIBILITY.
NOT SCORE APPLICATIONS OR MAKE
DECISIONS ARE PROJECTS APPROVALS
. OTHER HAS THIS PROGRAM
PROVIDES THE FOG DATASETS FOR
INPUTS. THAT ANY COMMUNITY CAN.
QUANTIFY RISK REGARDLESS OF DATA
AVAILABILITY THE STATE HAS A
MITIGATION PLAN IS A DOCUMENT
THAT CONSIDERS THE- THE
INTERSECTION OF EXPECTED LOSSES
FROM NATURAL. HAZARD IMPACTS TO-
EQUITY PROPERTY COMMUNITIES- IN
CLIMATE CHANGE FACTORS- THAT
AFFECT THE HAS IMPACTS KELLY S.
ALSO IMPLIES BROWN ABILITY
CRITERIA. TO DETERMINE
ELIGIBILITY. FOR PREPARE
CALIFORNIA MATCH PROGRAM WHICH
CAN COVER NON FEDERAL COST SHARE
ASSOCIATED WITH THE FEMA HAZARD
MITIGATION PROGRAM. AND FINALLY
CALAVERAS UTILIZES FIRE HAZARD
SEPERTI MAPPING PERFORMED BY OUR
PARTNERS AYE CALIFORNIUM
ELIGIBILITY IMPROVISATION A FOR
THE CALIFORNIA WILDFIRE
MITIGATION PROGRAM THAT WE HAVE
A JOINT POWERS AUTHORITY WITH
APART IS THAT CALIFORNIA'S.
COUNTY SUPPORTED BY THIS PROGRAM
WERE SELECTED AND RANKED- BY
IDENTIFYING THE OVERLAP OF HIGH
WILDFIRE HAZARDS AND ALSO THEIR
HIGH SOCIAL VULNERABILITY. ARE
RESCATA PARCEL IN CENSUS TRACT
LEVEL I THANK YOU FOR YOUR TIME
AND I'M AVAILABLE FOR ANY
QUESTIONS AFTER THAT. THANK YOU
NETWARE FROM GLENN POMEROY CHECK
CHIEF EXECUTIVE OFFICER
CALIFORNIA EARTHQUAKE AUTHORITY
IN READY GOOD MORNING SEVEN
MEMBERS THANK YOU FOR INVITING
ME TO BE HERE TODAY. THAT CA IS
THE STATE'S NOT FOR PROFIT REAL
QUICK INSURANCE ENTERPRISE
ESTABLISHED BY THE LEGISLATURE
IN THE MID NINETIES IN. THE WAKE
OF THE DEVASTATING NORTHRIDGE
EARTHQUAKE. PUBLICLY MANAGED BUT
TURLEY PRIVATELY. RADIO REST
EARTHQUAKE INSURANCE AND ONLY IN
CALIFORNIA. NOW WITH OVER ONE
MILLION POLICY HOLDERS CA'S
LARGEST EARTHQUAKE INSURER IN
UNITED STATES AND ONE OF THE
LARGEST IN THE WORLD.
FORTUNATELY LARGE DAMAGING
EARTHQUAKES ARE INFREQUENT. BUT
UNFORTUNATELY UPSET WHEN THEY
OCCUR THEY CAN BE CATASTROPHIC.
BECAUSE EARTHQUAKE INSURERS LACK
ACCESS TO HISTORICAL DATA. UPON
WHICH TO PROJECT FUTURE LOSS
ESTIMATES AND ESTABLISH RATES.
THE USE OF MODELS FOR THIS
CATASTROPHIC RISK IS BOTH
NECESSARY AND AUTHORIZED. C. A.
IS REQUIRED BY CALIFORNIA LAW TO
SET ACTUARIALLY SOUND RATES.
THAT IS RATES THAT ARE NOT
INADEQUATE NOT EXCESSIVE AND NOT
UNFAIRLY DISCRIMINATORY. AND AN
ADDITIONAL REQUIREMENT IS THAT
C. E. RATES BE BASED ON BEST
AVAILABLE SCIENCE. TO MEET THESE
TWIN LEGAL REQUIREMENTS C. EIGHT
DOES USE CATASTROPHIC MOUNT
MODELS TO NUMBER ONE DEVELOP
REYES. AND MITIGATION DISCOUNTS.
TO DETERMINE THE AMOUNT OF
CLAMPING CAPACITY THAT WE NEED
FOR OUR POLICYHOLDERS TO ASSIST-
ESTABLISH CA LOSSES- THEIR
ESTIMATE TO SEE LOSSES AFTER
AFTER AN EVENT. AND FOR ONGOING
STRATEGIC PLANNING PURPOSES. ARE
ENABLING STATUTES CONTEMPLATED
MODEL USAGE FOR ESTABLISHING
RATES AND LAID OUT THE
REQUIREMENT THAT RATE
DIFFERENTIALS MAY BE ESTABLISHED
ONLY IF THE INFORMATION AND
METHODS ARE CONSISTENT WITH THE
STATE OF THE ART OF SEISMIC
KNOWLEDGE. AND WITHIN THE
SCIENTIFIC COMMUNITY. FOLLOWING
INCEPTION IN NINETEEN NINETY SIX
AND ONCE THE PORTFOLIO INSURED
HOMES HAD FULLY TRANSITIONED TO
THE CA. THE CA GOVERNING BOARD.
BEGAN EXAMINING THE APPROPRIATE
MODEL CLAIMS FINCA PASSIVELY FOR
THE PORTFOLIO. QEP CONTEST
REMODELS WERE UTILIZED FOR KEY
METRICS SUCH AS THE CAPACITY
NEEDED TO PROVIDE COVERAGE FOR
TARGET LEVELS. AS WELL AS THE
CAPACITY FOR REPEATS OF HISTORIC
EARTHQUAKES. TO THIS DAY IN WITH
THE GOVERNING BOARD SUPPORT
APPROVAL CA CONTRACTS WITH THREE
WIDELY COMMERCIALLY RECOGNIZED A
KIT KAT LOS MODELERS. VERISK
LOGIC AND RISK MANAGEMENT
SOLUTIONS ARE A MESS. WE USE
THOSE TO VIEW A BROAD RANGE OF
MODELING RESULTS FOR PLANNING
PURPOSES INCLUDING EVALUATING
CLAMPING CAPACITY TARGETS. AS
WELL AS TO DETERMINE THE
EXPECTED REINSURANCE RECOVERABLE
FOR THE MANY RESTAURANTS FOR
CONTRACTS WE PURCHASE. A UNIQUE
FEATURE OF THE CA STATUTE IS
THAT EXEMPTS CA- FROM THE
CALIFORNIA INSURANCE GUARANTY
FUND SEGA. AND INSTEAD
CONTEMPLATES THAT CA WOULD PAY
CLAIMS ON A PRO RATA OR
INSTALLMENT BASIS IF AN EVENT
EXCEEDS OUR CLAMPING CAPACITY.
CDI REGULATIONS REQUIRE. THAT
UPON THE OCCURRENCE OF AN
EARTHQUAKE EVENT IN THE STATE
THAT IS LIKELY TO GIVE RISE TO
SIGNIFICANT LOSSES. C. STAFF
SHALL CREATE A SCIENTIFIC MODEL
OF ANTICIPATED LOSSES WITHIN
SEVEN DAYS. HERE AGAIN CA IT
WILL USE A CAT MODELS- TO
SATISFY THAT REQUIREMENT.
ANOTHER FEATURE OF THE CA
ENABLING STATUTE IS THE REQUIRED
HAZARD MITIGATION DISCOUNT. C.
A. IS REQUIRED TO PROVIDE A
DISCOUNT OF AT LEAST 5% IF THE
INSURER- IF THE INSURED
MITIGATES THEIR HOME. BUT THE
MAXIMUM DISCOUNT WE KNOW
CURRENTLY MAKE AVAILABLE IS UP
225% THE SCHEDULE OF DISCOUNTS
WAS DEVELOPED FROM CONTEST
REMODEL OUTPUT. WE ALSO USE CAT
MODEL OUTPUT FOR STRATEGIC
PLANNING AND EVALUATING A
VARIETY OF. WHAT IF SCENARIOS
RANGING FROM A CONTEST REMODEL
RESPONSE DRILLS A TO A COVERAGES
ON. AND FINALLY. ALL OTHER
CALIFORNIA EARTHQUAKE INSURANCE
WRITERS CAN AND DO USE
CATASTROPHE LOSS MODELS FOR
SETTING RATES AS ALLOWED BY CDA
REGULATIONS. THIS IS THE SAME
SECTION ALSO. ALLOWS PRIVATE
INSURERS TO USE CATASTROPHE LOSS
MODELS TO DEVELOP THE ESTIMATE
FOR THE FIRE FOLLOWING
EARTHQUAKE LOSS RISK WHICH IS
PART OF THE HOMEOWNER INSURANCE
RATE DEVELOPMENT PROCESS. THANK
YOU MISTER BABBITT ANSWER
QUESTIONS VERY THANK YOU NOW
HEADS OUR NEXT. PERSON BE
LEARNED FROM THE EXACT DIRECTOR
STRATEGIC GROWTH COUNCIL LIMON
RIGHT. GOOD MORNING AND THANK
YOU ROGER AND HER ASSEMBLY
MEMBER APPRECIATE YOU INVITING
ME TO DRAW YOU TODAY HI MY NAME
IS LYNN FRANCO. I AM THE EXACT
DIRECTOR OF THE CAL STRATEGIC
GROWTH COUNCIL. NUMBER THREE
COUNCIL OR S. C. IS IT MEMBER
COUNCIL THAT IS COMPRISED OF
SEVEN STATE CABINET AGENCIES AND
THREE PUBLIC MEMBERS. ARE GRANT
AND LOAN PROGRAMS SEEK TO MAKE
AN IMPACT IN A VARIETY OF ISSUE
AREAS FROM AGRICULTURAL LAND TO
AFFORDABLE HOUSING TO RACIAL
EQUITY BUT ALL PRIORITIZE
TECHNICAL ASSISTANCE CAPACITY
BUILDING COMMUNITY ENGAGEMENT
AND MULTI BENEFIT PROJECTS TO
ADVANCE HEALTHY THRIVING AND
RESILIENT COMMUNITIES. WE
ADMINISTER A VARIETY OF SOCIAL
AND PHYSICAL INFRASTRUCTURE
PROGRAMS THAT ARE RELEVANT TO
TODAY'S DISCUSSION INCLUDING THE
AFFORDABLE HOUSING INSTANCE
AVAILABLE COMMUNITIES WHICH
INVESTS IN MULTI UNIT AFFORDABLE
HOUSING AND SUSTAINABLE
TRANSPORTATION INFRASTRUCTURE.
THE TRANSFORMATIVE CLIMATE
COMMUNITIES WHICH INVESTS IN
PLACE BASED MULTI BENEFIT
PROJECTS TO ACHIEVE
ENVIRONMENTAL HEALTH AND
ECONOMIC BENEFITS AND
DISADVANTAGED COMMUNITIES. AND
THE REGIONAL CLIMATE
COLLABORATIVE'S WHICH FUNDS
LOCAL CROSS SECTORAL
COLLABORATIVES TO BUILD CAPACITY
TO ACCESS FUNDING FOR CLIMATE
RESILIENCY PROJECTS. BUT THESE
PROGRAMS PRIORITIZE CLIMATE AND
EQUITY WHICH REQUIRES A FORWARD
LOOKING AND ACCESSIBLE APPROACH
TO INVESTMENTS. STC'S PROGRAMS
DO NOT CURRENTLY USE
CATASTROPHIC MODELING IN THEIR
FUNDING DECISIONS INSTEAD WE ASK
APPLICANTS TO USE CALIDAD OPT
AND OTHER TOOLS PROVIDED BY THE
STATE ALONG WITH COMMUNITY
ENGAGEMENT PRACTICES TO IDENTIFY
RISKS OF A CHANGING CLIMATE IN
THEIR COMMUNITY. AND TO SHARE
HOW THEIR PROJECT BUILDS
RESILIENCE. CALIDAD IS A FREE
TOOL DEVELOPED BY THE STATE OF
CALIFORNIA'S CLIMATE CHANGE
ASSESSMENTS THE MAKES CLIMATE
DATA MUCH MORE ACCESSIBLE FOR
THE STATE COMMUNITY MEMBERS AND
LOCAL GOVERNMENTS TO UTILIZE IN
CLIMATE ADAPTATION AND
RESILIENCY AND PLANNING. FOR
EXAMPLE ONE PROGRAM STC
ADMINISTERS THAT UTILIZES
CALIDAD IS THE COMMUNITY REAL
ZILLION SEE CENTER OR THE C. R.
C. PROGRAM. CRC IS A NEW PROGRAM
THAT INVESTS IN THE PLANNING AND
BUILDING OF A NEIGHBORHOOD LEVEL
RESILIENCY CENTER TO PROVIDE
SHELTER AND RESOURCES DURING
CLIMATE AND UP AND OTHER
EMERGENCIES. AS WELL SERVICES
AND PROGRAMS THAT BUILD
COMMUNITY RESILIENCE YEAR ROUND.
LAST MONTH C. R. C. RELEASED
THEIR FIRST ROUND OF FUNDING IN
WHICH NINETY EIGHT POINT SIX
MILLION DOLLARS BECAME AVAILABLE
TO COMMUNITIES ACROSS THE STATE
. C. R. C. REQUIRES APPLICANTS
TO USE CALIDAD LOCAL CLIMATE
SNAPSHOT TOOL WHICH PROVIDES
CLIMATE PROJECTIONS FOR
TEMPERATURE RAIN AND WILD FIRE
TO DETERMINE RISK EXPOSURE AT
THE PROJECT LOCATION. WE ALSO
ASK APPLICANTS TO BUILD ON
KALIDAS DATA WITH BEST AVAILABLE
QUALITATIVE AND QUANTITATIVE
DATA SOURCES INCLUSIVE A
REGIONAL AND COMMUNITY DATA TO
DISCUSS GAPS AND NEEDS FOR LOCAL
PRIORITY POPULATIONS. APPLICANTS
SHOULD ALSO USE COMMUNITY
ENGAGEMENT METHODS TO ENSURE
THEY ARE PROVIDING DIRECT
MEANINGFUL AND ASSURED BENEFITS
THAT ADDRESS POTENTIAL CLIMATE
HAZARDS. APPLICANTS WHO THEN
SCORED ACCORDING TO HOW THEY
LEVERAGE THEIR FINDINGS TO
MITIGATE ENVIRONMENTAL SOCIAL
AND ECONOMIC RISKS. THEY MUST
EXPLAIN ADAPTATION AND
RESILIENCY MEASURES TAKEN TO
REDUCE THESE RISKS THROUGH THEIR
PROJECT DESIGN. THIS INCLUDES
PROGRAM SERVICES EMERGENCY
ACTIVATION PROCESSES FOR
RESILIENCY CENTERS TO RESPOND TO
CLIMATE EMERGENCIES AS WELL
SPECIFIC DESIGN FEATURES FOR THE
FACT FACILITY AND SURROUNDING
CRC CAMPUS. THEY CAN
APPROPRIATELY AND EFFECTIVELY
RESPOND TO IDENTIFIED CLIMATE
HAZARDS. OVERALL STC AIMS TO
ADDRESS CLIMATE RELATED RISKS
THROUGH ITS PROGRAMS ESPECIALLY
FOR DISADVANTAGED COMMUNITIES
ANOTHER PRIORITY POPULATIONS
FACING THE BRUNT OF THE IMPACTS
OF CLIMATE CHANGE. WE USE TOOLS
LIKE HOLIDAY OPTED TO SUPPORT
COMMUNITIES THAT ARE MOST
VULNERABLE TO THE IMPACTS OF
CLIMATE DISASTER. BILLS SOCIAL
AND FISCAL CLIMATE RESILIENCY
BECAUSE THEY ARE IMPACTED BY
ECONOMIC HEALTH AND OTHER
INTERSECTION ISSUES. AND AS WE
CONSIDER THE USE OF EXISTING AND
NEW DATA DRIVEN RESOURCES WE
SHOULD BE INTENTIONAL AND
CAREFUL TO AVOID EXASPERATED
EXASPERATING ENVIRONMENTAL
JUSTICE ISSUES BY FURTHER
DISINVEST. AREAS INSTEAD THE
TOOL SHOULD INFORM HOW WE CAN
INVEST IN TO SUPPORT COMMUNITIES
AT HIGHEST RISK THROUGH PHYSICAL
AND SOCIAL INFRASTRUCTURE. AS
YOU SEE TAKES THIS EQUITY FOCUS
LENS TO INVEST IN THE SOCIAL AND
PHYSICAL INFRASTRUCTURE TO MAKE
CLIMATE HAZARDS LESS DAMAGING IN
THE FUTURE AND EASIER TO RECOVER
FROM IN THE PRESENT. THANK YOU
IN AVAILABLE FOR QUESTIONS.
THANK YOU VERY MUCH OUR NEXT
WE'LL MOVE ON TO. MIKE PETERSON
DEPUTY COMMISSIONER FOR THE
CLIMATE AND SUSTAINABILITY FROM
THE CALIFORNIA CALIFORNIA
DEPARTMENT OF INSURANCE WHEN
YOU'RE READY MIKE. THANK YOU
VERY MUCH- GOOD MORNING CHECK
OUT OUR OWN VICE CHAIR ASSEMBLY
CHAIR RODRIGUEZ AND VICE HER
WALDRON. AND MEMBERS OF THE
COMMITTEES. THANK YOU FOR THE
INVITATION TO TESTIFY HERE TODAY
I MIKE PETERSON AND I SERVICE
DEPUTY COMMISSIONER FOR CLIMATE
SUSTAINABILITY OF THE CALIFORNIA
DEPARTMENT OF INSURANCE UNDER
THE LEADERSHIP OF INSURANCE
COMMISSIONER RICARDO LARA. THE
OVERARCHING APPROACH FOR
COMMISSIONER LARA AND ADDRESSING
THE CHALLENGES POSED BY
WILDFIRES FOR INSURANCE HAS BEEN
TO CONTINUE TO PRIORITIZE
REDUCING RISKS TO CALIFORNIA
COMMUNITIES. THE DEPARTMENT
INSURANCE HAS FOCUSED ON A MULTI
YEAR EFFORT. AND GAUGING WITH
CONSUMERS AND STAKEHOLDERS AS IT
ASSESSES HOW NEW TOOLS CAN
IMPROVE RISK MANAGEMENT. MAKE
RESIDENTIAL AND COMMERCIAL
INSURANCE MORE ACCESSIBLE AND
RELIABLE FOR CALIFORNIANS AND
MAINTAIN COMPETITION AND ENSURE
STABILITY IN THE STATE'S
INSURANCE MARKETPLACE. THE
DEPARTMENT OF INSURANCE HAS BEEN
VERY CLEAR THAT BENEFITS TO
CONSUMERS ARE OF UTMOST
IMPORTANCE AS WE TRY AS WE
STRIVE TO INCREASE THE
AVAILABILITY. OF RELIABLE
INSURANCE FROM THE MID MARKET.
ENSURE THE LONG TERM STABILITY
OF RATES AND INCENTIVIZE THE
ACCURATE RECOGNITION OF WILDFIRE
MITIGATION EFFORTS. THE
FOLLOWING ACTIONS PROVIDE
FURTHER EXAMPLES OF OUR MULTI
YEAR EFFORT TO IMPROVE RISK
MANAGEMENT. IN TWENTY NINETEEN
PRESSURE LARA CONVENE HIS CLIMB
INSURANCE WORKING GROUP WITH
ENVIRONMENTAL ADVOCATES
RESEARCHERS WILDFIRE OFFICIALS
AND INSURANCE EXPERTS WHICH
FOCUSED ON PRODUCING
RECOMMENDATIONS TO REDUCE THE
INCREASING IMPACTS. FROM CLIMATE
INTENSIFIED WILDFIRES FLOODING
AND EXTREME HEAT AND THE CLOTHES
INSURANCE PROTECTION GAPS.
FURTHERMORE IN DECEMBER TWENTY
TWENTY COMMISSION LARA HELD A
VIRTUAL PUBLIC MEETING FOCUSED
ON FIRE SCIENCE TO EXAMINE HOW
WILD FOR MITIGATION COULD REDUCE
THE SPREAD. AND RISK OF FUTURE
WILDFIRES AND THE EXTENT TO
WHICH WILD FOR CATASTROPHE
MODELING. ALIGNED WITH WILDFIRE
MITIGATION AS A RATE MAKING
TOOL. CAN IMPACT MARKET
COMPETITION AND INSURANCE
AVAILABILITY. THE COMMISSION
INVITED TESTIMONY FROM FOURTEEN
INDIVIDUALS WITH WILD HER
EXPERTISE AND EXPERIENCE
INCLUDING THE INSTITUTE FOR
BUILDING FOR BUSINESS AND HOME
SAFETY. THREE RESEARCHERS FROM
THE UNIVERSITY OF CALIFORNIA
REPRESENTATIVES FROM FOR
CATASTROPHE MODELING FIRMS WHO
HAVE DEVELOPED MODELS FOR
INSURANCE. TO ACTUARIES WITH
CALIFORNIA SPECIFIC EXPERIENCE A
MEMBER OF THE CULTURAL FIRE
COUNSELING YUROK TRIBE. A
COMMUNITY WILDFIRE MITIGATION
SPECIALISTS AND REPRESENTATIVES
FROM THE CENTER FOR INSURANCE
POLICY RESEARCH AT THE NATIONAL
ASSOCIATION INSURANCE
COMMISSIONERS. AND CALIFORNIA.
THEN IN TWENTY TWENTY TO
COMMISSIONER LARA PROMULGATED
HIS GROUND BREAKING REGULATION
THAT RECOGNIZES AND REWARDS
WILDFIRE SAFETY AND- MITIGATION
EFFORTS MADE BY HOMEOWNERS AND
BUSINESSES A REGULATION BECAME
OPERATIVE IN OCTOBER TWENTY
TWENTY TWO. THE FOURTH
CALIFORNIA CLIMATE ASSESSMENT
WAS PUBLISHED IN TWENTY EIGHTEEN
AND FOUND THAT IF GREENHOUSE GAS
EMISSIONS CONTINUE TO RISE THE
FREQUENCY OF EXTREME WILDFIRES
WILL INCREASE. IN THE AVERAGE
AREA BURNED STATEWIDE WOULD GROW
BY 77% BY TWENTY ONE HUNDRED.
THIS FINDING UNDERSCORES
IMPORTANCE OF RISK MITIGATION
ACTIONS AND INFORM THE WORK OF
THE CLIMB INSURANCE WORKING
GROUP. IN TWENTY TWENTY ONE THE
WORKING GROUP RELEASED THE FIRST
EVER CLIMB INSURANCE REPORT.
AMONG THE RECOMMENDATIONS THE
WORKING GROUP STRESS THE
IMPORTANCE OF RISK ASSESSMENT TO
INSURANCE AVAILABILITY AND
RELIABILITY. ONE RECOMMENDATION
ADVISED THE INSURANCE
COMMISSIONER TO HOLD PUBLIC
MEETINGS SPECIFICALLY ON THE USE
OF CATASTROPHE MODELS AS A TOOL
FOR ESTIMATED CATASTROPHE LOSSES
NOTING THAT A PUBLIC MEETING
WOULD PROVIDE THE PUBLIC AN
OPPORTUNITY TO DISCUSS THE USE.
OF SUCH POLICY TOOLS. THE USE OF
ACTUAL STORE CATASTROPHE LOSSES
HAS BEEN THE LONG STANDING
METHOD USED OVER SEVERAL DECADES
FOR ESTIMATING CATASTROPHE
ADJUSTMENTS. IN THE CALIFORNIA
RATE APPROVAL PROCESS HOWEVER
HISTORICAL LOSSES DO NOT FULLY
ACCOUNT FOR GROWING WILDFIRE
RISKS OR RISK MITIGATION
MEASURES TAKEN BY COMMUNITIES OR
REGIONALLY. AS A RESULT OF LOCAL
STATE OR FEDERAL INVESTMENT.
EXPANDING INSURANCE OPTIONS FOR
CALIFORNIANS AND PROMOTING WILD
COMMUNITY WILDFIRE RISK
MITIGATION WERE FOUNDATIONAL
PIECES OF THIS REPORT'S
RECOMMENDATION. INVESTMENT
NAZARIAN FOR STRUCTURE MITIGATES
RISK AT THE COMMUNITY LEVEL SUCH
AS FOREST MANAGEMENT COASTAL
DUNE IN MARCH RESTORATION AS
WELL AS PRESCRIBED BURN
STRATEGIES TO REDUCE FUTURE
WILDFIRE SEVERITY. ARE CENTRAL
TO COMMUNITY RISK REDUCTION AND
COULD BE REFLECTED IN MODELING
TOOLS. I WILL CONCLUDE BY
EMPHASIZING THAT THE DISCUSSION
CATASTROPHE MODELS AS A TOOL AS
PART OF A PROGRESSION. OF PUBLIC
MEETINGS ENGAGEMENT WITH. THE
RISK ASSESSMENT EXPERTISE OF
UNIVERSITIES AND STAKEHOLDERS AS
WE HAVE EVALUATED THE BENEFITS
TO CONSUMERS. THANK YOU FOR THE
OPPORTUNITY TO BE HERE AND I
WOULD. I WOULD BE PLEASED TO
TAKE YOUR QUESTIONS. OKAY THANK
YOU. THE LAST WE'LL HEAR FROM
LUCY **** DEPUTY COMMISSIONER
AND SPECIAL COUNSEL FOR THE
CALIFORNIA DEPARTMENT OF
INSURANCE WHEN YOU'RE READY TO
SEE HI GOOD MORNING THANK YOU.
I'M LUCY **** AND I SERVICE
DEPUTY COMMISSIONER AND SPECIAL
COUNSEL TO COMMISSIONER LARA
THANK YOU FOR THE OPPORTUNITY TO
SPEAK WITH YOU THIS MORNING. AS
YOU JUST HEARD FROM MY COLLEAGUE
WITH THE CONTINUED THREAT OF
CLIMATE CHANGE AND ITS
ASSOCIATED AFFECT ON OUR GLOBAL
AND STATE ECONOMY INSURANCE
COMPANIES ARE CONTINUALLY TRYING
TO MANAGE THE RISK. AND THE
CALIFORNIA DEPARTMENT OF
INSURANCE IS ALSO CONTINUALLY
TRYING TO EXPLORE ADDITIONAL
TOOLS THAT COULD BENEFIT OUR
CONSUMERS THROUGH INCREASED
INSURANCE COVERAGE OPTIONS. TO
THAT END THE DEPARTMENT SENT A
NOTICE LAST WEEK REGARDING ITS
WORKSHOP SCHEDULED FOR JULY
THIRTEENTH REGARDING CATASTROPHE
MODELING AND INSURANCE. AS YOU
HEARD FROM MY COLLEAGUE THIS
JULY WORKSHOP IS THE
CONTINUATION OF AN EFFORT THAT
COMMISSIONER LOTTA STARTED AFTER
TAKING OFFICE HE CONTINUES TO BE
ON THE FOREFRONT OF ADDRESSING
THE RISKS. ASSOCIATED WITH
CLIMATE INTENSIFIED WILDFIRES
AND THIS WORKSHOP SUPPORTS AS
LONG TERM STRATEGY OF PROTECTING
CONSUMERS WHILE MAINTAINING
COMPETITION AND ENSURING
STABILITY IN OUR STATE INSURANCE
MARKETPLACE. THIS IS A PRIORITY
NOT JUST FOR THE COMMISSIONER
BUT FOR THE ENTIRE STATE OF
CALIFORNIA. AND THIS JULY
WORKSHOP IS GOING TO FOCUS ON
EXPLORING THE LEGAL QUESTIONS
PRESENTED BY THE USE OF
CATASTROPHE MODELING IN
INSURANCE RATE APPROVAL. AS
MISTER GREEN HERE HAD SET FORTH
EARLIER IN HIS TESTIMONY THERE
ARE SEVERAL POTENTIAL BENEFITS
OF WILDFIRE MODELING FOR
CONSUMERS. WILDFIRE CATASTROPHE
MODELING HAS THE POTENTIAL TO
INCREASE ACCURACY AND THE RATE
MAKING PROCESS BY USING REAL
WORLD ON THE GROUND CONDITIONS
TO SIMULATE WILDFIRE BEHAVIOR
AND ESTIMATE WILDFIRE WITH.
CATASTROPHE MODELING COULD ALSO
RECOGNIZE THE POSITIVE IMPACT OF
HOME HARDENING INVESTMENT
COMMUNITY LEVEL MITIGATION
STRATEGIES AND IT FUELS
REDUCTION PROJECTS AT THE
REGIONAL AND LOCAL LEVELS.
COUPLED WITH A CLEAR COMMITMENT
BY INSURERS TO WRITE IN MORE
HIGH WILDFIRE RISK AREAS OF OUR
STATE ESPECIALLY FOR THOSE WHO
ARE VULNERABLE AND LIVING IN THE
WILL BE. CATASTROPHE MODELING
COULD CREATE GREATER ST
STABILITY AND SUSTAINABILITY.
HOWEVER THESE MODELS ARE SUBJECT
TO IMPORTANT TRANSPARENCY
REQUIREMENTS AND OTHER CONSUMER
PROTECTIONS UNDER CURRENT
CALIFORNIA LAW. THE INSURANCE
CODE REQUIRES THAT THE
DEPARTMENT BE ALLOWED TO
EVALUATE ANY SUCH MODELS TO
ASSURE THAT REACH GENERATED FROM
SUCH MODELS ARE FAIR JUSTIFIED
IN ACCURATE. AND THE GOAL OF FOR
JULY WORKSHOP IS TO DISCUSS HOW
WE CAN INCORPORATE CATASTROPHE
MODELING INTO CALIFORNIA'S
INSURANCE RATEMAKING PROCESS
WITHIN A REGULATORY FRAMEWORK.
THE SPECIFIC QUESTIONS THAT THE
DEPARTMENT SEEKS TO ASK AND
DISCUSS OUR ONE THE SIGNIFICANT
AN IMPACT OF INSURANCE CODE
SECTION ONE EIGHT SIX ONE. DOT
ZERO SEVEN WHICH REQUIRES
CATASTROPHE MODELS TO BE
PUBLICLY DISCLOSED. TO WHAT
POTENTIAL METHODS CAN BE
EMPLOYED TO ENSURE THAT THE
DEPARTMENT CAN REVIEW
CATASTROPHE MODELS IN ACCORDANCE
WITH SECTION ONE EIGHT SIX ONE
DOT ZERO SEVEN WHILE PRESERVING
THE PROPRIETARY INFORMATION OF A
PARTICULAR CATASTROPHE MODEL.
AND LASTLY OTHER STATES HAVE
INCORPORATED ALTERNATIVE METHODS
OF STRUCTURING MODEL REVIEW SUCH
AS THE USE OF AN INDEPENDENT
THIRD PARTY OR THIRD PARTY PANEL
AND ARE THERE METHODS USED BY
OTHER STATES THAT WOULD BE A
VIABLE OPTION HERE IN
CALIFORNIA. ME THE DEPARTMENT IS
ALSO WORKING TO EVALUATE THE
POTENTIAL RISKS AND NECESSARY
SAFEGUARDS THAT SHOULD BE PUT IN
PLACE FOR CATASTROPHE MODELING
TO BE USED IN OUR RATE MAKING
PROCESS. THE DEPARTMENT INTENDS
TO HOST A SECOND WORKSHOP LEADER
THIS SUMMER WHICH WOULD ADDRESS
THE PRACTICAL CONSIDERATIONS
ASSOCIATED WITH CATASTROPHE
MODELING SUCH AS ONE MODEL
STABILITY SHOULD THE DEPARTMENT
EXPECT PROPERTY INSURANCE RATES
TO BE MORE STABLE IF INSURANCE.
PERMITTED TO MODEL WILDFIRE
PERIL WHAT IS THE IMPACT OF
CATASTROPHE MODELING ON
INSURANCE RATES FOR CALIFORNIA
CONSUMERS. TO MODEL ACCURACY
OVER THE PAST FEW YEARS
CATASTROPHIC WILDFIRE EVENTS
HAVE OCCURRED THAT HAVE ALLOWED
INSURERS TO SUPPORT SIGNIFICANT
RATE INCREASES BASED ON
ADJUSTMENTS IN THE DEPARTMENT'S
RATEMAKING FORMULA. WILL
PERMITTING THE USE OF
CATASTROPHE MODELING MORE
ACCURATELY SUPPORT RATE REQUEST
BY INSURERS IN THE FUTURE. AND
MOST IMPORTANTLY HOW WOULD
ALLOWING CATASTROPHE MODELING
BENEFIT CALIFORNIA HOMEOWNERS
AND BUSINESSES. WITH THE USE OF
CATASTROPHE MODELING ACCOMPLISH
SOMETHING THAT COULDN'T BE DONE
THROUGH SOME OTHER MEANS SUCH AS
A REGULATORY ADJUSTMENTS TO HOW
WE CURRENTLY USE HISTORICAL
CATASTROPHE LOSSES. THE GOAL OF
THESE WORKSHOPS IS TO CONTINUE
THE COMMISSIONERS COMMITMENT TO
EXPLORING HOW NEW TOOLS SUCH AS
CATASTROPHE MODELING CAN MAKE
RESIDENTIAL AND COMMERCIAL
INSURANCE MORE ACCESSIBLE AND
RELIABLE FOR CALIFORNIANS. AS WE
PROTECT CONSUMERS AND CREATE
SAFER COMMUNITIES. THANK YOU FOR
THE OPPORTUNITY TO ADDRESS THIS
IMPORTANT TOPIC HERE TODAY AND
I'M AVAILABLE TO ANSWER ANY
QUESTIONS. THANK YOU VERY MUCH
OUR WITHOUT WORK BRING UP FOR
MEMBERSHIP QUESTION AND FROM-
SIR NUMBER OF QUESTIONS OF
UNCOMMON TO LIGHT REALLY. YOU
PUTTING THIS HEARING TOGETHER
AND- SORT OF NEW IN THE
INSURANCE AREA I DON'T SIT ON
THE EITHER ONE OF THESE
COMMITTEES BUT WITH THE NEW
DISTRICT THAT I HAVE- WE HAVE A
LOT OF ISSUES WITH FIRE
INSURANCE. THE BIGGEST SIDE I
KNOW THAT THE INSURANCE
COMMISSIONER IS VERY FOCUSED ON
REDUCING RISK AND RATE
STABILITY. WE KNOW OUR PROBLEM
IS THAT PEOPLE ARE BEING DROPPED
AT AND THEY ARE UNABLE TO BE.
REINSURED IN OUR AREA AND I
APPRECIATE WE'VE DONE A NUMBER
OF WORKSHOPS WITH YOU BUT WE
HAVE HOMEOWNERS ASSOCIATIONS
THAT CANNOT GET INSURANCE.
LUCKILY THE FAIR PLAN HAS
INCREASED ITS COVERAGE TO TWENTY
MILLION WHICH IS HELPFUL FOR
SOME OF THESE- TOWNHOUSE
ASSOCIATIONS BUT- THIS THIS IS.
HUGE ISSUE THAT I'VE STAFF WHO
LAST WEEK WAS A COUPLE OF WEEKS
WAS TOLD BY FARMER THAT SHE- NOT
INSURED ANYMORE AND- IS GONNA
HAVE TO FIGURE OUT. SOME OTHER
INSURANCE PLAN- EVEN THOUGH OUR
ENTIRE AREA IS CONSIDERED HIGH
RISK EVEN THAT FOR HOMES THAT
ARE NOT RIGHT NEAR- OF OPEN
SPACE SO. YOU HAVE YOUR WORK CUT
OUT FOR YOU AND HOPEFULLY THE
LEGISLATURE CAN HELP LONG BUT-
HI I'VE- BEEN A WIDE I DON'T
KNOW HOW MUCH CONVERSATION THERE
HAS BEEN BUT IT'S- ABOUT THE
EARTHQUAKE AUTHORITY AND DOESN'T
MAKE SENSE. TO HAVE A FIRE
THORGY SO. WHAT WOULD THAT IT
YOU KNOW MAYBE THAT'S SOMETHING
THAT'S BEEN DISCUSSED IN THE
INSURANCE COMMITTEE BUT- WHAT
WHAT DOES THAT LOOK LIKE AND
WHAT. HOW DO IT MAKE SENSE FOR
THE STATE TO START LOOKING AT
THAT AS A POSSIBLE SOLUTION.
PARTIAL SOLUTION. ABOUT THE
QUESTION FREE YES YES- WELL
THANK YOU THE M. THE CA'S
CREATURE STATUTE- ASSIGNED THE
RESPONSIBILITY OF ENSURING FOR
EARTHQUAKE IN NINETY SIX- AND
IT. DOING SO THE SELLERS ARE
ALSO ESTABLISHING MITIGATION
PROGRAM WE KNOW RETROFITTED-
TWENTY THOUSAND HOMES AND HOW TO
DOUBLE THAT. IN TWENTY NINETEEN
WE WERE GIVEN THE RESPONSIBILITY
TO OVERSEE THAT THE HECK CARE
ACT CONTEST FOR WELFARE FUND. SO
WE TAKE HIS RESPONSIBILITIES
SERIOUSLY AND WE DISCHARGED AND
WE HIT THIS QUESTION HAS NOT
BEEN BROUGHT TO US AND- RIGHT WE
HAVE OUR HANDS FULL DEALING WITH
THE SAME MARKET CHALLENGES THAT.
PRIVATE INSURERS DO IN TERMS OF.
THE REINSURANCE CAPACITY
SHRINKING AND GETTING MORE
COSTLY SO WE'RE FOCUSED ON THAT
ARE DISCHARGING OUR MISSION.
WHICH IS A- BIT OF A HOPEFULLY A
POLITE WAY OF SAYING WE HAVE NOT
LOOKED AT THAT AND DON'T FEEL
IT'S IN WITH BUT WITHIN OUR
STATE STREET- ASSIGNMENT TO DO
SO. RIGHT I I'M I'M JUST TALKING
ABOUT A SEPARATE YOU KNOW
CALIFORNIA FIRE AUTHORITIES.
BECAUSE OBVIOUSLY THE SITUATION
THAT WE'RE IN RIGHT NOW IS
UNTENABLE. SO AND- I GUESS MAYBE
IT'S TO BE EXPLORED. DEFINITELY
SOME WE CAN LOOK AT THEM OKAY
ANY OTHER QUESTIONS. NINE ORTEGA
SWIMMER TAKE A QUESTION- I. AM
OF THE NEED TO INSURANCE
COMMISSION- BUT I I'VE BEEN
INTERESTED IN KIND OF THE
ANNOUNCEMENT THAT WAS MADE BY
THE INSURANCE COMPANIES WE'VE
BEEN GETTING A LOT OF QUESTIONS
FROM. SOME OF MY CONSTITUENTS I
DON'T HAVE A BIG FIRE AT. A YEAH
BUT I DO HAVE SOME. AND SOME OF
THE ACTUALLY CALLED AND SAID
THEY'RE NOT BEING RENEWED- SO
JUST YOU KNOW I HEARD THE
INSURANCE COMMISSIONER STAFF
TALK ABOUT. BALANCING THE
COMPETITION AT AND WITHIN THE
INSURANCE MARKET WITH PROTECTING
CONSUMERS AND MAKING SURE THAT
WE- WE- YOU KNOW LOOK AT WHAT'S
HAPPENING AND JUST LOOKING AT
ONE OF THE SPREAD SHEETS HERE
I'M JUST LOOKING AT THAT LOSSES
RIGHT. AND THE INCREASE GOING UP
FROM. NINETEEN NINETY SEVEN TO
TWO TWENTY EIGHTEEN AT 6100214%
IS WHAT I'M LOOKING AT SO HOW IS
IT YOU TALKED ABOUT- YOU KNOW
THAT THE FOR. KIND OF LIKE OUT
THAT YOU'RE LOW AT A AT MODELING
AND HOW YEAR. THAT'S KIND OF
YOUR FREE SO KEEP A LITTLE BIT
MORE ABOUT WHAT THAT MEANS. IN
TERMS OF WHAT WE'RE SEEING AND
MOVING FORWARD AND HOW CAN WE BE
SUPPORT OF. WELL HOLDING-
MEETING SUCH AS TODAY ARE VERY
HELPFUL IN TERMS OF THE
OPPORTUNITY TO DISCUSS YOU KNOW
THIS IMPORTANT TOPIC I THINK THE
QUESTION THAT YOU ARE LOOKING AT
IN TERMS OF WHAT YOUR
CONSTITUENTS ARE FACING WITH NON
RENEWALS. IS A LITTLE BIT
SEPARATE FROM FROM THIS
WORKSHOP- TODAY AND THE
DEPARTMENT'S WORKSHOP IS
SPECIFICALLY FOCUSED ON
INCORPORATING CATASTROPHE
MODELING INTO OUR RATE MAKING
PROCESS I THINK THE ISSUE WHICH
IS ALSO A DIFFICULT ONE
REGARDING YOUR CONSTITUENTS AND
THEIR ABILITY TO OBTAIN
INSURANCE AND- WHO ARE NON
RENEWALS IS KIND OF SEPARATE.
AND I'M HAPPY TO DISCUSS THOUGHT
YOU KNOW FURTHER AT A AT A
DIFFERENT OPPORTUNITIES THAT
SPECIFIC TO THE POINT THAT THAT
I DISCUSSED IN MY TESTIMONY WE
REALLY ARE LOOKING OUT. HOW WE
CAN INCORPORATE CATASTROPHE
MODELING INTO OUR RATE MAKING
PROCESS ONE GIVEN THE FACT THAT
WE HAVE A- INSURANCE LAWS IN
PLACE THAT REQUIRE A BALANCE
BETWEEN TRANSPARENCY- AND WE'RE
BALANCING THAT WITH. OUT THESE
MODELING- MODELING COMPANIES
PROPRIETARY INFORMATION AND THEN
TO WHAT ARE THE PRACTICAL
REALITIES INCORPORATING
RATEMAKING NUMBER ONE- FOR
COMMISSIONER IS ALWAYS YOU KNOW
HOW WE PROTECT OUR CONSUMERS
BOTH IN TERMS OF. IF WE ALLOW
SUCH A TOOL IS IT GOING TO
INCREASE AVAILABILITY OF
POLICIES WHAT IS THE COST OF
THAT AND THOSE ARE THE THINGS
THAT WERE GOING OUT THAT WAY THE
DEPARTMENT. SIX TO LOOK INTO
WITH THESE WORKSHOPS. THANK YOU
SO MUCH FOR THE CALL I COULD
JUST ADD- TO MARK POINTS ON YOU
KNOW IT WHEN I COMES TO BOTH NON
. AND THE PRICE INCREASE THE
CORE ISSUE IS THE WILDFIRE RISK
AND SO. ON WHEN WE CAN
EFFECTIVELY MANAGE RISK REDUCE
RISK INSURANCE BECOMES MORE
AVAILABLE AND AFFORDABLE AND SO
IT'S BEEN AFTER A CRUCIAL THAT
THE LEGISLATURE. AND THE
GOVERNOR HAVE APPROPRIATED
NEARLY THREE BILLION DOLLARS
OVER THE LAST COUPLE YEARS
TWELVE HER MEDICATION BECAUSE
THAT DOES HAVE AN IMPACT. ON THE
SEVERITY OF WILDFIRES AND THEN
IN THE FUTURE ACCESS TO
INSURANCE- IN THE SECOND POINT I
WOULD JUST MAKE IS THAT. YOU
INSURANCE REGULATORS ACROSS THE
COUNTRY ARE DEALING WITH THE
ISSUES OF CLIMATE INTENSIFIED
EVENTS WHETHER THEIR FIRES OR
FLOODS OR- STORMS AND SO WHEN IT
COMES TO NON RENEWALS AND ISSUES
WE DO MONITOR THOSE WE DO DATA
COLLECTIONS. AND OUR ROLE IS
REALLY GOING TO TRY TO HELP
PEOPLE NAVIGATE WHAT THOSE
OPTIONS ARE AND HOW THEY HAD
ENCOURAGING- INSURANCE COMPANIES
TO EXPAND. HOW THE WRITING IN
OUR STATE. THANK YOU. THANK YOU
RIGHT I APPRECIATE BREAKING AT
THE INTO PARTS. THAT THANK YOU
VERY MUCH. THANK YOU WITH THAT
ASSEMBLYMEMBERS WOULD GIVE. YET
SO FROM SORRY I'M BACK. THE SO.
WHAT I UNDER YOU ST THAT IT
SOUNDS LIKE THE DEPARTMENT OF
INSURANCE IS MOVING TOWARDS
CATASTROPHE MODELING AND
FIGURING OUT HOW TO INCORPORATE
THAT IN CALIFORNIA IS THAT.
RIGHT THAT IS CORRECT OKAY
EXCELLENT SO. MY QUESTION IS.
CATASTROPHE MODELING AND I FEEL
LIKE NOW IS BEING PUT OUT HERE
AS- THE HOLY GRAIL WHERE WE NEED
TO GET TO IN CALIFORNIA IS GOING
TO CHANGE EVERYTHING- DO WE HAVE
ANY. ASSURANCES COMMITMENTS YOU
KNOW WE HAVE INSURERS WERE
PULLING OUT WE HAVE REINSURER.
AND REINSURANCE THAT'S
DISAPPEARING. HOW HOW CONFIDENT
DO WE FEEL THAT THIS IS GOING TO
MAKE THE CHANGE THAT WE NEED TO
SEE HAPPENED IN CALIFORNIA THAT.
FOLKS WILL COME ON BACK THAT
FOLKS WILL NOT LEAVE THE PEOPLE
REINVEST DO WE THINK THAT THIS
IS GONNA BE THIS KIND OF SILVER
BULLET TO. SOLVE THE PROBLEMS I
MEAN IT'S STILL IT'S STILL
CALIFORNIA WILDFIRES IT'S A
COSTLY STATE TO BE AND THERE'S
BILL CHALLENGES AROUND IT-
CERTAINLY TALKING MY YES. I
WON'T BE OFFENDED. THANK YOU FOR
YOUR CALL EACH I THINK THE TO
TAKE A STEP BACK YOU KNOW COULD
MODELING IS A RISK ASSESSMENT
TOOL THAT'S ONE PIECE OF A
BIGGER PUZZLE RIGHT THERE IS THE
RISK ASSESSMENT. THERE'S A RISK
REDUCTION AND THEN I WILL
COMMISSIONER LARS VERY
INTERESTING IS A FIRM COMMITMENT
FROM INSURANCE COMPANIES TO
EXPAND WRITINGS ESPECIALLY IN
AREAS WHERE THERE- THERE HAVE- I
STOPPED WRITING IN THE WILDFIRE
RISK AREAS AND SO. TO YOUR
QUESTION IS THIS YOU KNOW TO
WHAT DEGREE IS THEIR SILVER
BULLET AS I MENTIONED EARLIER
INSURANCE REGULATORS ACROSS THE
COUNTRY DEALING WITH THE RISING
COSTS FROM A NUMBER OF GLOBAL
ISSUES- AND SO I THINK THAT
WHAT'S IMPORTANT IS THAT WE
REALLY GET STARTED ON THE RISK
REDUCTION. AND ALL THESE LOOKING
AT THE RISK ASSESSMENT TOOLS
LIKE WE ARE DOING WITH THIS
UPCOMING WORKSHOP SO THAT WE
HAVE ALL THOSE PIECES. IN IN IN
PLACE AS WE LOOK AT THE OVERALL
SITUATION RIGHT BUT YOU KNOW
JUST- YEAH REITERATE. WE'VE
SEEN- SEVERE WILDFIRES-
INCREASINGLY IN CALIFORNIA OUR
OWN CLAIM ASSESSMENTS ARE
LOOKING AT THE FUTURE AND THAT
IS YOU KNOW THE CHALLENGES THAT
WE FACE AND SO. THEY ARE THERE'S
DIFFERENT PARTS AND I THINK
THAT- THE PREVIOUS REGULATION
ON- THE SUPER FROM WILDFIRES
REALLY TRY TO FOCUS ON WHAT CAN
CONSUMERS DO TO REDUCE THE RISK
UP THEIR HOME. AND IN THIS
UPCOMING WORKSHOP IS LOOKING AT
WHAT ARE THE RISK ASSESSMENT
TOOLS AND WE- WILL INSURANCE
COMPANIES COMMIT TO WRITING MORE
AND EXPANDING THEIR WRITINGS-
WITH- THE IDEA AND- A KIND OF
DIFFERENT RISK MANAGEMENT-
ALTERNATIVES. SO THANK YOU. SO
I'M- FORWARD THE RISK REJECT
REDUCTION I MEAN I'VE HEARD-
ASSEMBLY MEMBER OUR QUE HAN WAS
HERE EARLIER I DON'T KNOW IF YOU
HEARD HER COMMENTS THAT THEY'VE-
LITERALLY PUT SPRINKLERS. THE
FORESTS AROUND HOUSING IN AND
THEY'RE STILL NOT GETTING
COVERAGE RIGHT AND SO THEY'RE
GOING TO BE. PRETTY WELL I WOULD
FEEL LIKE A PRETTY EXTREME.
STEPS TO MAKE SURE THAT THEY'RE
REDUCING RISK AND STILL NOT
GETTING COVERED- YOU KNOW I'VE
HEARD JUST ANECDOTALLY FROM
OTHER FOLKS THAT THEY'VE DONE
EVERYTHING THAT THEY WERE
SUPPOSED TO DO TO BE ABLE TO
BRING RISK DOWN ON THEIR
PROPERTY AND STILL INSURANCE
COMPANIES HAVE NOT. LOWERED
THEIR RATES- SO THAT'S KIND OF
ONE CONCERN I HAVE AROUND HOW
FOR THAT WILL GO- AND THEN- YOU
KNOW AND THEN I JUST WANTED TO
PUT UP A PLUG IN HERE BECAUSE I
THINK YOU MENTIONED- SOME KIND
OF REVIEW PROCESS WHEN KIDS.
CATASTROPHIC MODELING IS USED
BECAUSE I'M NOT SURE IF YOU
HEARD EARLIER BUT THE EXAMPLE
THAT I USED OF MY COMMUNITY
WHICH **** UP AGAINST THE SANTA
SUSANNA MOUNTAINS WOULD
LITERALLY HAVE A FIRE FIRE AT
THE END OF MY BLOCK. EVERY YEAR
MAYBE MULTIPLE TIMES A YEAR BUT
IT'S VERY CONTAINED IT'S OUT AND
YOU KNOW A HALF HOUR- AND IN THE
SIXTY YEARS IN OUR COMMUNITY.
NONE OF THE HOUSES OF EVER
BURNED FROM IT RIGHT AND SO I
YOU KNOW HEARD FROM THE
PANELISTS EARLIER THAT THEY'D
TRY TO INCORPORATE. THE
SUPPRESSION TACTICS AS PART OF
THE MODELING WHICH TRIED ISN'T
REALLY MAKE ME SUPER CONFIDENT.
ABOUT HOW THAT WORKS OUT- AND SO
I THINK HAVING PEOPLE BE ABLE TO
REVIEW OR TAKE EMPLOYED OR KIND
OF- HAVE A BROADER PROCESS THAN
PUTTING SOMETHING INTO A
COMPUTER AND SPITTING IT OUT IN
ASSUMING THAT THAT'S- THE- THE
MOST ACCURATE- KIND OF MODEL
THAT YOU COULD COME UP WITH- SO
JUST WANTED FLAG THAT AS A- AS A
CONCERN OF MINE- HOW DO WE- HOW
DO WE- ADDRESS. IT SUCH A HEART
I FEEL LIKE IT'S SUCH A HARD
BALANCE THAT WE HAVE RIGHT NOW
RIGHT BECAUSE- INSURANCE
COMPANIES. ARE TAKING ON HUGE
RISK AND EXPENSES AND IT HAS TO
BE HAS TO PENCIL OUT FOR THEM
RIGHT. TO BE ABLE TO BE IN THIS
BUSINESS HERE IN CALIFORNIA. I'M
AT THE SAME TIME. YOU KNOW OUR
CONSTITUENTS. EITHER CAN'T GET
COVERED CAN'T GET THE RATES
DOWN- OR JESTER PAINS SO MUCH
FOR IT IT'S UNAFFORDABLE- SO YOU
KNOW. HOW DO WE ADDRESS IF
PEOPLE ARE DOING ALL OF THIS.
RISK REDUCTION- AND MITIGATION
AND THEN. THEY'RE NOT SEEN A
RESULT FROM THEIR INSURANCE
COMPANY ON THAT- AND DO WE HAVE
LIKE. IS THERE A PLAN B. YOU
KNOW BECAUSE WE DON'T WE DON'T
KNOW THE ALL OF THIS IS GONNA
WORK OUT- I DON'T KNOW I DON'T
KNOW MAYBE YOU KNOW BUT I DON'T
KNOW. AND IT YOU KNOW I DON'T
KNOW JACKIE'S IDEA LIKE WHAT OUR
TO OUR THERE'D IDEAS THAT WE ARE
COMING UP WITH TO THINK ABOUT A
PLAN B. I'M I'M REALLY CONCERNED
ABOUT THIS ISSUE IT LITERALLY
COMES UP EVERY TIME I'M IN THE
DISTRICT IT'S A HUGE ISSUE AND I
DISTRICT AND THROUGHOUT
CALIFORNIA AND- AND SO. I A M. I
FEEL LIKE WE NEED TO BE MOVING
INTO ACTION THAT REALLY MAKES AN
IMPACT IN PEOPLE'S LIVES- AND-
AND UNDERSTAND WE HAVE TO
PROCEED CAUTIOUSLY AND GET A LOT
INFORMATION THROUGH THAT PROCESS
BUT- BUT- I'D- JUST. DESERT IT'S
A WILL THERE'S A LOT OF
CONCERNS. I THINK. IN THE
INTEREST THANK YOU FOR YOUR YOUR
QUESTIONING AND CONCERNS AND TO
RESPOND TO THAT I MEAN FIRST OF
THIS IS A REALLY IMPORTANT
ISSUE- YEAH I DO I WANTED TO
KIND OF JUST NOTE TWO THINGS AND
ONE IS WHEN IT COMES TO RISK
MITIGATION- WE- AS A STATE HAVE.
ROUTE THANK XCELERATED OUR
APPROACH TO THAT OVER THE LAST
COUPLE YEARS MANY OF THOSE
EFFORTS HAVEN'T YET COME TO
FRUITION SO I THINK WE ARE IN.
SORT OF A MOVING SITUATION- ADAM
JUST LIKE TO KEEP POINTS ON
THAT. YOU KNOW ONE IS THE
COMMISSIONER LARA'S- SAVER FROM
WILDFIRES REGULATIONS- TWO. WE
RECEIVED RATE FILINGS IN APRIL
AND SO CONSUMERS MOVING FORWARD-
WILL BE REQUIRED TO RECEIVE
INCENTIVES BASED ON THOSE HOME
HARDENING- FACTORS BUT ALSO
WHETHER IN FIREWISE COMMUNITY
AND WHETHER YOU'RE IN A FIRE
RISK REDUCTION COMMUNITY. ON AND
SO THAT IS STILL YET TO COME TO
FULL FRUITION. I'M AND THEN
SECONDLY YOU KNOW AS A STATE
WE'VE APPROPRIATED SIGNIFICANTLY
NEW- SIGNIFICANT NEW AMOUNTS OF
MONEY TOWARDS WILDFIRE RISK
REDUCTION BUT THAT DOES TAKE
TIME. TO WORK ITSELF INTO
PROJECTS THAT REDUCE RISK. I'M
AND CAN BE REFLECTED IN A MODEL
OR AN INSURANCE VIEW OF THE
SITUATION- AND THEN WE'VE ALSO
SEEN A DRAMATIC INCREASE IN THE
NUMBER OF FIREWISE COMMUNITIES
OVER THE LAST FIVE YEARS I
THINK. IT'S GONE FROM- YOU KNOW
SOMEONE THAT YOU HUNDREDS TO
NEARLY FIVE HUNDRED VERY QUICKLY
AND SO AS THE EXAM SORRY. AS
EXAMPLE THAT YOU NOTED YOU KNOW
THOSE FIREWISE COMMUNITIES ARE
GETTING SET UP THERE DOING MORE
THINGS AND THEY'RE GONNA BE
DOING MORE THINGS THAT. I THINK
ARE BEST PRACTICES MOVING
FORWARD THAT WE'LL HAVE MORE
MORE IMPACT AND SO I THINK
YOU'VE GOT KIND OF. THE
IMPLEMENTATION OF REGULATIONS
THE APPROPRIATIONS GOING INTO-
PROJECTS AND YOU KNOW BOTH OF
THOSE ARE GOING TO HAVE AN
IMPACT ON RISK- WILL IT BE THE
YOU KNOW ALTERNATE. A SILVER
BULLET I MEAN WE'LL KEEP
LEARNING KEEP WORKING FROM THAT
. WHAT AND THEN TO EUROPE. I'M
SORRY THIS WEIRD BECAUSE I TO
SPEAK A MIKE. YEARS BY ME BUT
THEN TO EUROPE I MEAN WHAT
YOU'RE RAISING OUR THE PRIME.
AND DIFFICULT QUESTIONS THAT WE
SEEK TO ADDRESS IN THESE
WORKSHOPS WHICH IS YOU KNOW
CATASTROPHE MODELING IS. MAY
PERHAPS NOT A SILVER BULLET BUT
IS BILLED AS HAVING THE ABILITY
TO PROVIDE GREATER ACCURACY WHEN
IT COMES TO. A PROVIDING FAIR
AND ACCURATE RELATES AND SO WHAT
THE COULD DEPARTMENT REALLY
WANTS TO EXPLORE IS WHAT DOES
THAT MEAN FOR CALIFORNIA
CONSUMERS WHAT IS OUR ABILITY TO
ASSESS. HOW THOSE MODELS WORK
BECAUSE AND NUMBER ONE IF WE
ALLOW THAT AS A RISK ASSESSMENT
TOOL ARE WE GETTING OUT AND GET.
A COMMITMENT FROM INSURERS TO
WRITE IN OUR WILL BE IN OUR HIGH
RISK AREAS SO THOSE YOU KNOW IN
THE UPCOMING MONTHS THOSE ARE
VERY MUCH THE ISSUES THAT. THE
COMMISSIONER SEEKS TO EXPLORE
THESE WORKSHOPS. THANKS WITH
THAT WE HAVE A QUESTION BY. BYE
CHURCH. IS A- THANK YOU- SO JUST
A QUICK QUESTION- FOLLOWING YOUR
WORKSHOPS AND HOW QUICKLY DO YOU
THINK. IT WOULD TAKE FOR THE
DEPARTMENT TO ALLOW FOR CAT
MODELING AND MEANING. KIND OF A
- COOL. THAT'S A TOUGH QUESTION-
I KNOW IT'S NOT A GOTCHA JUST NO
NO I KNOW IT'S NOT A KOCH AND
THAT AND THAT'S AND THAT'S
ESSENTIALLY WHAT WE'RE EXPLORING
BE WHAT'S DIFFERENT ABOUT
CALIFORNIA THAN THE OTHER STATES
AS- YOU KNOW WE HAVE A
REGULATORY FRAMEWORK IN PLACE.
THAT REQUIRES THE BALANCE
BETWEEN USING A TOOL SUCH AS
CATASTROPHE MODELING WITH OUR
RIGHT TO TRANSPARENCY AND I
THINK THAT WAS TOUCHED UPON SO
I'M ENCOURAGED BY THE
PRESENTATION MADE BY THE FIRST
PANEL IN TERMS OF. YOU KNOW
THEIR- OPENNESS TO MAKING THAT
INFORMATION AVAILABLE TO US
BECAUSE THAT'S WHAT WE'RE TO
DISCUSS OF THE FIRST WORKSHOP IS
UNLIKE OTHER STATES YOU KNOW OUR
STATUTES REQUIRE A LEVEL OF
TRANSPARENCY THAT OTHER STATES
DON'T REQUIRE AND HOW DO WE
THREAD THAT NEEDLE AND SO I
THINK. YOU KNOW IN TERMS OF HOW
QUICKLY WE CAN MAKE IT HAPPEN
REALLY IS GOING TO BE DEPENDED
UPON THE INFORMATION WE LEARN
OUR ABILITY TO BALANCE. YOU KNOW
OUR RATE MAKING PROCESS WITH OUR
REGULATORY FRAMEWORK. I THINK
YOU. OKAY WITH THAT- SOME
REMEMBER SALLY YOUR QUESTION.
SIR EIGHT YOU FOR BEING HERE SO.
IN CONVERSATION I JUST WANT TO-
BETTER UNDERSTAND THE HURDLES
THAT WE HAVE TO OVERCOME TO. TO
IMPLEMENT THIS BOB DOES LET ME
ASK. MR IS IT PALM POMEROY YES
SIR DO YOU GUYS CURRENTLY USE
THIS CATASTROPHIC MODELING TO
WRITE- EARTHQUAKE INSURANCE
POLICIES YES WE DO OKAY. HOW DO
YOU ARE YOU GUYS SUBJECT TO THE
SAME INSURANCE CODE THAT THAT
WAS REFERENCE ONE EIGHT SIX ONE
POINT ZERO SEVEN. NO- THE SHERIN
ASSEMBLY MEMBER THERE'S A
SPECIFIC BODY OF LAW THAT
CREATED THE CALIFORNIA
EARTHQUAKE AUTHORITY THAT
CONTEMPLATED THE USE OF MODELS.
GIVEN THE FACT THAT EARTHQUAKES
ARE SO RARE AND RISEN HISTORICAL
DATA RELIANCE SO REFRIGERATORS
MUST USE CONSTRUCTING MODELS AND
WE HAVE SINCE INCEPTION. OKAY
AND THEN- MISS WEIGHING YES WE
ASK YOU SO. THIS STATUTE THAT-
YOU KNOW REQUIRES ALL THE
INFORMATION BE MADE AVAILABLE TO
THE PUBLIC. IS THIS SOMETHING
THAT THE- LEGISLATURE. ENACTED
AS IS REQUIRED BY. THE
PROPOSITION THAT CREATED YOU ALL
. HOPE YOU'RE HAPPY TO HAVE
THAT. DISCOURSE YOU BUT NO THE-
YES THE LEGISLATURE TEACHER.
CREATE THE STATUE IN A ACTIVE IS
. A ONE OF THREE THIRTY FIVE
YEARS AGO SO IT'S PART THAT
FRAME AND SO I THINK THESE ISSUE
JUST TO. HOW WEAK ALLOW- HAD
CATASTROPHE MODEL AS RATE TOOL-
IT'LL OF THE- THAT WE REQUIRE
TRANSPARENCY DO YOU THINK IT
WOULD BE HELPFUL IF WE ADJUSTED
THE STATUE TO KIND OF MIRROR
WHAT WHAT THE EARTHQUAKE-
AUTHORITY. HAS FOR PURPOSE OF
THE CASTE REMODELING THIS ALLOWS
THE DEPARTMENT I DO THINK IT'S
IMPORTANT YOU HAVE THE ABILITY
TO REVIEW. THE CATASTROPHIC
MODELING. WITH YOUR EXPERTS AND
MAKE THAT DETERMINATION BUT ALSO
BALANCING- THE INTELLECTUAL
PROPERTY- THAT GOES INTO MAKING
THESE MODELS AND- AND IT'S A
BUSINESS THAT'S HOW THEY MAKE
MONEY. SO IT'S IT IS A BALANCE
YOU HAVE AN OVERSIGHT DUTY WHICH
I KNOW YOU GUYS TAKE- VERY
SERIOUSLY. SO I THINK YOU HAVE A
VERY RECEPTIVE- GROUP OF
LEGISLATORS IF YOU GUYS WERE TO
SAY. THIS IS SOMETHING WE WANT
TO DO. THIS LEGISLATION OR SOME
CHANGE THE LAW WOULD BE HELPFUL
IS THAT SOMETHING THAT. YOU GUYS
COULD CONSIDER NO ABSOLUTELY I
THINK YOU MAKE A GREAT POINT AND
I THINK THAT IS THE TYPE OF- YOU
KNOW ENTHUSIASM ENCOURAGEMENT WE
NEED AS WE ENTER THESE WORKSHOPS
AND WE LOOK MORE CLOSELY ALLIED.
EXACTLY HOW MUCH INFORMATION
MODELERS ARE GOING TO PROVIDE US
SO THAT WE HAVE ASSURANCE THAT
THE USE OF THESE MODELS IS GOING
TO BE DONE IN A WAY THAT WILL
BENEFIT CONSUMERS FIRST AND-
TAKEN TO THE PRACTICAL
CONSIDERATIONS OF HOW WE ASSESS
THAT. SO IF WE GO THROUGH THIS
FIRST WORKSHOP IN ARISES THAT
YOU KNOW PERHAPS THERE WERE
THESE TO BE MORE OF A
LEGISLATIVE FIX THAT I'M SO- YOU
KNOW GLAD TO KNOW THAT WE WILL
DEFINITELY WORK TOGETHER WITH
OUR- LEGISLATURES TO MAKE THAT
HAPPEN. I WANT SPEAK FOR MY
COLLEAGUES BUT I KNOW I WOULD
CERTAINLY. I WOULD CERTAINLY
WELCOME ANY LEGISLATIVE-
PROPOSALS YOU GUYS HAVE THAT
WOULD. STREAMLINE YOUR ABILITY
TO EVALUATE. IN APPROVED
BECAUSE- I THINK THERE'S HARD
QUESTIONS AND THEN THERE'S EASY
ONES INTO ME. THIS IS AN EASY
ONE BECAUSE EVERY OTHER STATE TO
MY KNOWLEDGE USES THESE AND THE
EARTHQUAKE COMMISSION USE THEM
SO- I THINK THERE'S A LOT OF.
DATA OUT THERE AND HOW THEY WORK
AND HOW THEY'RE HELPFUL
INSURANCE MARKET TO BETTER
ASSESS RISK. AND I THINK TO TRY
OF- RESPONSE ON MY COLLEAGUES-
QUESTIONS THERE I MEAN IF. WE
HAD BETTER RISK MODELS WE KNOW
WHICH PROPERTIES ARE ACTUALLY AT
THE HIGH FIRE RISK AS OPPOSED TO
THESE KIND OF. GENERIC AND WIDE
MAPS THAT ARE BEING USED NOW
WHICH ARE VERY ACCURATE. THEN WE
WOULD MAYBE HAVE A- SMALLER
GROUP OF PEOPLE IN THE FAIR PLAN
FOR EXAMPLE RATHER THAN. LARGE
GROUPS OF HOMEOWNERS AND THEN.
MAYBE HOAS WHO AREN'T REALLY
ENOUGH VIRUS CAN GET INSURANCE
INSTEAD OF RIGHT NOW BEING
KNOCKED OUT SO I DO. SEE A HUGE
BENEFIT TO USING THESE MODELS
AND HAVING BETTER ACCURATE. RISK
ASSESSMENTS- AND I WOULD JUST
SORT OF ECHO THE- MADAM CHAIRS-
SORT OF QUESTIONING THERE ON A
TIME LINE I KNOW YOU GUYS ARE
WORKING DILIGENTLY BUT- THE
SOONER WE CAN DO THINGS THE
BETTER BECAUSE WE DON'T WANT TO
LOSE MORE. INSURERS I THINK WE
HAVE TO MAINTAIN A HEALTHY
MARKET SO- WITH THAT ARE YOU I
WILL YIELD. THANK YOU. THANK YOU
OKAY WE HAVE ANOTHER QUESTION BY
SOME REMEMBER TAKE A- THANK YOU
SO- GOING BACK TO THE-
CATASTROPHE. MODELING AND THAT
BEING KIND OF THE WORK THAT
DIRECTION WE'RE HEADED- WELL I
APPRECIATE THAT. STATES ARE
ALREADY USING THIS. I DO FEEL
LIKE CALIFORNIA IS THE FOURTH
LARGEST ECONOMY IN THE WORLD
THEY WERE LEADER IN MANY SPACES.
AND SO I WOULDN'T. BE HESITANT
TO RUSH INTO SOMETHING WE
HAVEN'T DONE BECAUSE WE HAVEN'T
DONE IT FOR A REASON. SO I GUESS
ONE QUESTION THAT STILL KIND OF
THE ELEPHANT IN THE ROOM. IS
WOULD USING BECAUSE CATASTROPHE
MODELING PREVENT INSURERS FROM.
PRESSING PASS OR ISSUING NEW
POLICIES. OKAY. THANKS FOR YOUR
QUESTION IT EGAN IS IT'S A RISK
ASSESSMENT TOOLS OR IS THIS ONE
PIECE OF WHAT GOES INTO IT I'M
ALTERNATELY- INSURERS DECIDE
WHERE THEY'RE GOING TO WRITE AND
- UNDER WHAT RISKS THAT THEY
WILL- THEY DO CURRENTLY USE RISK
SCORES WILDFIRE RISK SCORES WHEN
IT COMES TO- CHARGING. CERTAIN
POLICYHOLDERS MORE IN HIGH RISK
AREAS VERSUS LOW RISK AREAS ON
BUT THIS IS A RISK ASSESSMENT
TOOLS SO. AS WE EXPLORE- OPTIONS
THROUGH THIS WORKSHOP- WE ARE
LOOKING FOR A FIRM COMMITMENT
FROM INSURERS THAT THEY WILL
EXPAND THEIR WRITINGS ON BY.
ALTERNATELY IT COMES DOWN TO
LIKE THAT RISK ASSESSMENT
ABILITY TO REDUCE THE RISK AND
THEN A TRACKING INSURERS TO HAVE
GOOD COMPETITION THAT WILL MAKE
INSURANCE MORE AFFORDABLE AND
RELIABLE. THANK YOU WITH THAT
THE SOME OF OUR OWN QUESTION S.
THANK YOU OF. JUST TO FOLLOW UP
ON ASSEMBLY MEMBER THOSE CALM
AND THE REST. TO THE HOME HARD
NAY AND HAVE THESE FIRE SAFETY
IS GREAT BUT WHAT WE HAVE FOUND
IS THAT INSURERS WHEN YOU ASK
FOR THE DISCOUNT OF SAID WELL
WE'RE NOT. WE'RE NOT GONNA BE
ENSURING IN YOUR AREA ANYMORE SO
IT IS CRITICALLY IMPORTANT THAT
WE MAINTAIN THAT THE HEALTHY AND
INSURANCE MARKETS. BUT FOLLOWING
UP FOR IT WITH ASSEMBLY MEMBER
ORTEGA'S COMMENTS. BUT- I THINK
DID MORE DATA AS VETERAN KNOWING
WHERE THE REAL RISKS ARE BUT YOU
ARE ALSO TAKING SOME OF THE LESS
RISKY PROPERTIES OUT OF THE
EQUATION AND NOW YOU'RE GOING TO
HAVE MANY HOMEOWNERS IN
EXTREMELY HIGH FIRE ZONE SAID. I
WOULD IMAGINE. WHAT IT ALL COMES
OUT WON'T BE ABLE TO GET
INSURANCE AT ALL SO HOW HOW
WOULD YOU HOW WOULD WE I MEAN I
ASSUME THAT THAT'S BEEN PART OF
THE- DISCUSSION RIGHT ONCE YOU
DO YOUR- YOUR YOUR YOUR MODELING
THAT STEVE FIND. SOME HOMES ARE
IN EXTREMELY PRECARIOUS
SITUATIONS. I THINK THAT YOU
KNOW IT WHEN IT COMES TO- A
CATASTROPHE MODELING INSURERS
ARE ALREADY USING THE MOST
MODELS FOR THEIR UNDERWRITING
AND SO I THINK THAT SOME OF
THAT- IS ALREADY. BEING USED
WHEN IT COMES TO THE RATE
APPROVAL RATE MAKING PROCESS I
THINK THAT YOU'VE GOT THE AGAIN
THESE TWO THINGS GOING ON. AS WE
GET MORE HARD IN HOMES IN THE
STATE THAT DOES REDUCE RISK AND
AS WE DO CAUGHT MORE COMMUNITY
MITIGATION IT DOES REDUCE RISKS
SO THAT'S ON THE RISK REDUCTION
SIDE- ON THE RISK ASSESSMENT THE
CADASTRE MODELS ME. MORE
ACCURATELY- DETERMINE WHAT RISKS
ARE THERE TODAY COMPARED TO
HISTORICAL DATA AND SO THAT CAN
AFFECT THE DECISIONS ON WHERE
TO. AN INSURANCE COMPANY RIGHTS
OR WERE THEY WERE THEY DON'T
WRITE BUT THE REALLY I'D SAY
THAT THAT RISK MITIGATION AT
HOME HARDENING IT IT HAS A
STRONGER A STRONGER IMPACT THE
MORE HOMES IN A COMMUNITY THAT
ARE HARD. AND SO AS THAT- THE-
WELL FOR MITIGATION GRANT
PROGRAM- YOU KNOW RAMPS UP AND
AS THESE REGULATIONS REQUIRING
TEACHERS TO PROVIDE. INCENTIVES
FOR THAT WE DO EXPECT TO SEE
MORE HARDENED HOMES AND FOR THAT
TO HAVE AN IMPACT REGARDLESS IF
YOU'RE IN THE HIGHEST RICK STONE
OR THE MORE MODERATE. ON YOU
IT'S STILL GOING TO MAKE THOSE
COMMUNITIES MORE INSURABLE- AND
SO I THINK JUST THE REALLY THE
STRAIGHTEST PATH TOWARDS INCHER
ABILITY. RUN THROUGH THAT RISK
REDUCTION AND SO WE'RE REALLY
TRYING TO PUT. AS MUCH FOCUS ON
THAT AS POSSIBLE. JUST A FOLLOW
JUST IN THE QUÉ. WILDFIRE MANY
YEARS PROGRAM- YOU KNOW WE HAVE
THE BRACE ABOUT PROGRAM. MANY
HOMES HAVE BEEN MITIGATED. AND
YOU KNOW YOU CAN DO THAT IN A
WAY. THAT IS- NOT AS CONDENSED.
AS WHAT. YOU JUST MENTIONED AND
WE ARE LOOKING AT THAT THAT THAT
THAT IS THE REASON WE'RE-
MITIGATING WHOLE COMMUNITIES.
HOPEFULLY TO BUY DOWN THE RISK
OF THAT WHOLE COMMUNITY SO THE
COMMUNITY CAN GET. INSURANCE
WHEN K. WITHOUT A JOB TWO QUICK
QUESTIONS AS A LOT OF THIS IS
KIND OF FACTORS SMALL COMMUNITY
IT IN THE ON THERE IS A
REPRESENT. COUNTY RIGHT NOW IS
THERE ANYBODY RESPONSIBLE
RESPONSIBLE FOR- REGULATING- THE
RATES BASED ON FIRE MAPPING. I'M
NOT SURE YOU COULD YOU CLEAR
WHAT WHAT TYPE OF FIRE MAPPING
I'M JUST LOOKING AT THE
REGARDING A FIRE MAPPING RISKS
IS THERE ANYBODY THAT REGULATES
OVERSEAS OUT. ON HOW THEY
INCREASE THE RATES BASED ON THE
MAP. SO IT'S A WE REVIEW AND
SCREEN AS ALL THE RATE FINDS
THAT COME IN I MEAN SURE IS
TYPICALLY HAVE BEEN USING WHAT
THEY CALL WILD HER RISK SCORES-
AND- OUR RECENT REGULATIONS DO
MAKE THOSE SCORES MORE
TRANSPARENT TO THE PUBLIC- ON.
THE COMPANIES THAT CREATE THE
SCORES- ARE- THEY ARE NOT PART
AND THEY'RE NOT INSURANCE
COMPANIES ARE NOT REGULATED BY
THE DEPARTMENT BUT- I ON- THE
CASE BY CASE OF EACH RATE FILING
THOSE SCORES ARE COMING IN WITH
THE RATE FILINGS IN THE
DEPARTMENT DOES- SCRUTINIZING
REVIEW THOSE PRIOR TO APPROVAL.
OKAY AND THEN JUST ONE LAST
QUESTION AS ONCE AGAIN TO THE
COMMUNITY THAT'S BEEN AFFECTED
AND MY DISTRICT. ARE IS THERE A
WAY WE CAN PROTECT HOMEOWNERS
BECAUSE I KNOW THERE'S GOOD
ACTORS AND BAD ACTORS RIGHT IN
THE INDUSTRY. AND SOME OF THESE
BAD ACTORS I THINK TAKE- IN
THEIR OWN HANDS FARM MAPPING AND
REGULATES HOW THEY INCREASE THE
RATES. IS THERE A WAY WE CAN
KIND OF PUT. WHAT PROTECTION IS
OR MAYBE UNDER HAVING SOME
WORKSHOPS COMING UP THERE COULD
PROTECT THAT HOMEOWNER BECAUSE-
THEY'RE GETTING THESE BILLS.
JUST OVERNIGHT THAT OKAY AS
EFFECTIVE TODAY YOUR RATES OR
QUADRUPLE RIGHT IN AND WORKPRINT
THE KIMBERLY FOR THEY HAVE NOW.
THIS HAPPENS AND IN SOME CASES
THESE FOLKS MAY BE OUT OF A HOME
BECAUSE THEY CAN'T HAVE ANY-
AWAY TO- TO PAY FOR THE
INCREASED. OF THE RISK RIGHT SO
ALONE ON A MAYBE AS YOU CAN LOOK
THROUGH THESE WORKSHOPS HAVING.
THE PROTECTION FOR THE
HOMEOWNERS AT. YOU KNOW GET
THESE THINGS UNEXPECTEDLY THAN.
WORST CASE NOT A HIGH. RIGHT
YEAH I REALLY APPRECIATE
QUESTION ON. YOU KNOW IT IT JUST
OF LIKE FOR THE- THAT WHEN
FILINGS IN THEY ARE. SCRUTINIZED
AND INSURANCE CARRIERS HAVE TO
JUSTIFY WHY THEY'RE CHARGING
WHAT READ TO. THEIR WHAT PREMIUM
TO WHICH SERIES OF CUSTOMERS-
THIS IS SOMETHING THAT WE
CONTINUE TO LOOK AT. GIVEN THE
LAST FIVE YEARS OF SEVERE FIRES
THERE'S LOTS OF LOSSES IN MANY
OF INSURANCE COMPANIES-
EXPERIENCE AND SO. THAT DOES
HAVE AN IMPACT ON WHAT RATES
THEY CAN JUSTIFY IN THEIR RATE
FILINGS- BUT I APPRECIATE. YOUR
QUESTION ABOUT- THIS COMMUNITY I
THINK THAT IT'S SOMETHING THAT.
YOU KNOW WILL CONTINUE TO REALLY
LOOK AT AND- AND WE DO HOPE
THAT. BY REWARDING THE HOMES
THAT ARE ABLE TO DO DEFENSIBLE
SPACE. AND HER IN THEIR HOMES
THAT THERE WILL HELP TO SUMMIT
TO SOME EXTENT. THANK YOU OKAY
THINGS WERE MUCH SO WITH THAT
SAID WE MOVED ON TO OUR LAST
PANEL NOT TURN IT BACK OVER TO.
ARCHER CALDERON. THANK YOU LEARN
BATTLES THANK YOU MISTER CHAIR
AND I'D LIKE TO THANK THE PANEL
FOR THE DISCUSSION. AS THE NEXT
PANEL WILL DISCUSS WILDFIRES IN
CATASTROPHE MODELING AND ON THIS
PANEL WE HAVE DANIEL BERLIN
ACTING STATE FIRE MARSHAL OF CAL
FIRE. FRANK FROM FALLS DIRECTOR
OF THE WILDLAND URBAN INTERFACE
FIRE INSTITUTE CAL POLY SAN LUIS
OBISPO AND NANCY WATKINS
PRINCIPAL CONSULTING. ACTUARY AT
MILLIMAN. WHENEVER YOU'RE READY
ALL RIGHT WILL A GOOD MORNING-
AROUND MEMBER OF THE COMMITTEE-
JENNIFER LANG AT SAFE MARSHAL AS
WELL AS- FIRE'S. DEPUTY RECTOR
OF WHILE. PREPAREDNESS IN
MITIGATION- TODAY I'M GONNA TALK
A LITTLE BIT ABOUT CAL FIRE'S
WILDFIRE MITIGATION EFFORTS A
LITTLE BIT ABOUT OUR- A RISK
MODELING AND HAZARD MODELING HOW
IT AFFECTS. WHAT WHAT WE'RE
DOING AND THEN A LITTLE BIT OF
WHAT WE'VE DONE TO WORK WITH THE
DEPARTMENT OF INSURANCE- AND
OTHER STAKEHOLDERS TO REALLY
ADVANCE OF THESE MITIGATION
EFFORTS- IN CALIFORNIA MAKE SURE
THAT THEY ARE MEANINGFUL. DURING
THE PAST COUPLE OF YEARS
CALIFORNIA HAS MADE MAJOR
INVESTMENTS- IN WILDFIRE
MITIGATION EFFORTS- THAT HAVE
BEEN A CRUCIAL PART OF OUR
STRATEGY- IN COMBATING WILDFIRES
ACROSS THE STATE. AND REALLY
THANKS TO A MULTI YEAR FUNDING
BY YOU- BY THE ADMINISTRATION-
WE HAVE BEEN ABLE TO REALLY
SIGNIFICANTLY INCREASE.
ASSISTING COMMUNITIES IN THE
MITIGATION EFFORTS THAT HAVE
BEEN TALKED ABOUT TODAY
DEFENSIBLE SPACE HOME HARDING
COMMUNITY LEVEL MITIGATION AS
WELL AS FOREST MANAGEMENT IN
FACT- YOU HAVE INVESTED OVER TWO
POINT SEVEN BILLION DOLLARS IN
JUST THE LAST COUPLE OF YEARS.
IN THE IN THIS EFFORT- AND
DURING THAT TIME WE'VE TAKEN A
SIGNIFICANT AMOUNT OF THAT
MONEY. IN FACT OVER FIVE HUNDRED
MILLION DOLLARS- AND AWARDED
THAT TO LOCAL FIRE SAFE COUNCILS
LOCAL COMMUNITIES- TO AUGMENT
THE STATE'S EFFORTS- TO REALLY
EMPOWER. AND ENHANCE THE FIRE
PREVENTION AND FOREST HEALTH
PROJECTS- THAT WE BELIEVE ARE
CRITICAL IN REDUCING OUR FIRE
RISK AS WELL AS RESTORING ARE
FORCED. BACK TO THEIR NATURAL
STATE. NO CALIFORNIA HOMEOWNERS
UP PLAY A CRITICAL ROLE IN FIRE
PREVENTION THROUGH THE
MAINTENANCE OF DEFENSIBLE SPACE-
THROUGH HOME HARDING WHICH I'LL
TALK ABOUT IN A MOMENT- AS WELL
AS KIND OF COMMUNITY BASED.
MITIGATION EFFORTS AND BACK TO
THE FUNDING THANK YOU TO.
INCREASED INVESTMENTS IN IN
STAFFING WE HAVE BEEN ABLE TO
INCREASE THE NUMBER OF
DEFENSIBLE SPACE INSPECTIONS THE
NUMBER OF EDUCATIONAL VISITS
THAT WE CAN MAKE A. TOOL
HOMEOWNERS LIVING IN WILDLAND
AREAS- TO THEM CREATE THAT THAT
WORK AROUND THEIR HOME IN FACT
WE'VE INCREASED BY 67% I IN THE
LAST- IT COMPARED A COUPLE
FISCAL YEARS. AGO AND BEEN ABLE
TO INCREASE TO PERFORMING OVER
THREE HUNDRED THOUSAND-
DEFENSIBLE SPACE INSPECTIONS IN
THIS WORK IS CRITICAL BECAUSE
THIS IS GONNA CLEARING OF DEAD
OR DYING VEGETATION THAT IS
FLAMMABLE AROUND HOMES.
INCREASING THEIR CHANCES OF
SURVIVING BUT IN ADDITION TO
THAT IMPORTANT WORK WE HAVE
REALLY. FOCUSED IN ON HOW WE
BUILD HOMES AND WHERE WE BUILD
HOMES ENSURING THAT HOMES ARE
HARD AND MEANING THAT THEY
CONSTRUCTION MATERIALS THAT
THEY'RE BUILT OUT OF. CAN RESIST
THE EMBERS FROM WILDFIRES AND SO
THAT COMBINATION OF GOOD
DEFENSIBLE SPACE- AND HARDENED
OF THOSE HOMES A REALLY DOES
INCREASE- THAT HOMES CHANCE OF
SURVIVING BUT- WHILE IN THE
LAST. FIFTEEN YEARS OR SO WE'VE
HAD SOME OF THE MOST STRINGENT
BUILDING CODES. IN THE WORLD-
YOU HERE IN CALIFORNIA IN
WILDLAND AREAS. MANY HOMES WERE
BUILT BEFORE THAT CODE AND SO
THAT IS WHERE RETROFITTING AND
AGAIN THIS TERM OF HARDENING.
THOSE HOMES- BECOMES SO
IMPORTANT BUT LET ME JUST TELL
YOU OUR WILDFIRE RISK REDUCTION
EFFORTS THAT WE ARE DOING- ARE
WORKING. OUR POST WILDFIRE-
RESEARCH AND DATA HAS SHOWED US
THAT HOMES THAT HAD DEFENSIBLE
SPACE OR- THAT HAD HARD IN THEIR
HOMES ARE BUILT OUT OF THE
CURRENT BUILDING. COULD
MATERIALS I HAD A SIGNIFICANT
INCREASE IN CHANCE OF SURVIVING.
A WILDFIRE SO REALLY TO
SUMMARIZE OUR WILDFIRE
RESILIENCE STRATEGY IS REALLY
BEEN A NESTED APPROACH WE ARE
FOCUSED ON THE HOME IN THE
COMMUNITY WE LOOK AT THE
WILDLAND URBAN INTERFACE AROUND
IT. AS WELL AS AS THE FOREST AND
MAKING SURE AGAIN THAT THE
ECOSYSTEM IS HEALTHY. BUT IN
ORDER FOR US HERE IN CALIFORNIA
TO BE SUCCESSFUL IN THESE
MITIGATION EFFORTS- ALIGNMENT IS
CRITICAL- IT'S IT WE HAVE TO
MAKE SURE THAT THESE CORE
ELEMENTS. ARE THE SAME THAT
OTHER INDUSTRIES SUCH AS
INSURANCE INDUSTRIES- LOCAL
ORDINANCES AND FIRE DEPARTMENTS-
THAT WE ARE ALIGNED. IN WHAT
STANDARDS WE ARE WE ARE ASKING
FOR BECAUSE IF WE ARE ALL
TELLING OR REQUIRING SOMETHING
DIFFERENT MAKES IT VERY
DIFFICULT. FOR THE PUBLIC TO
KNOW WHICH OF THOSE MATTER WHICH
OF THOSE ARE IMPORTANT SO
ALIGNMENT ON THESE EFFORTS HAS
BEEN- I ATE A HUGE FOCUS OF OURS
OVER THE LAST COUPLE OF YEARS-
MY COLLEAGUE MIKE PETERSON FROM
THE DEPARTMENT INSURANCE TALKED
ABOUT. OUR EFFORT. TOGETHER THE
MINISTRATION- SEVERAL
DEPARTMENTS INCLUDING CAL FIRE
WORKING WITH THE DEPARTMENT OF
INSURANCE- TO LEND OUR EXPERTISE
IN WILDFIRE MITIGATION TO MAKE
SURE THAT- STATEWIDE STANDARDS
FOR HOME HARD IN A COMMUNITY
HARDENING- ARE TAKEN INTO
ACCOUNT WHEN IT COMES. TO
INSURANCE AVAILABILITY- AND
INSURANCE- INCENTIVES AND OUT OF
THIS PARTNERSHIP- CAME THE SAFER
FOR WILDFIRES A FRAMEWORK AND IT
REALLY IS A DOCUMENT- FOR
INSURANCE COMPANIES- THAT REALLY
FOCUS ON BOTH PERSONAL LEVEL AND
COMMUNITY LEVEL MEASURES- THAT
CAN BE USED TO CREATE A
CONSISTENT APPROACH- FOR THE
INSURANCE. SECTOR AND EMPOWER
THOSE COMMUNITIES TO REDUCE
THEIR WILDFIRE RISK BEFORE A
DISASTER. STRIKES AND WHAT IS SO
IMPORTANT- ABOUT THIS FRAMEWORK
AND WHY I AND I REALLY WANT TO
ACKNOWLEDGE- HOW IMPORTANT IS
FRAMEWORK HAS BEEN. IS THAT IT
OUTLINES THE BEST PRACTICES THAT
WE REQUIRE AT THE STATE OF THIS
THE MINIMUM REQUIREMENTS OF THE
STATE SETS IN WILDFIRE
MITIGATION- BUT IT TAKES IN THE
LATEST BEST PRACTICES THE LATEST
SCIENCE- THE LATEST RESEARCH AND
ENSURES THAT THOSE INSURANCE
COMPANIES. ARE USING THAT SAME-
THAT SAME FRAMEWORK AND SO AGAIN
THE KEY TO THE FRAMEWORK IS A
LINE AND WE ALL HAVE TO BE DOING
AND SAYING. THE SAME THING AND I
KNOW MY COLLEAGUES HERE- WILL
WILL PROBABLY A HIT ON IT AS
WELL MANY OF THE PEOPLE THEY
HAVE TESTIFIED IN FRONT OF YOU
TODAY. PARTIS PAID IN THAT AND I
REALLY HAS BEEN I THINK A AND
PART OF THE STRATEGY IS ALL
STAKEHOLDERS COMING TOGETHER A
GREEN UPON THAT IT SCIENCE
AGREED UPON- THOSE THOSE FACTORS
. SO I'LL TAKE A STEP BACK AND
TALK A LITTLE BIT ABOUT OUR
EFFORTS IN BOTH A HAZARD
MODELING- AND ALL ALL ALL ALL
FOCUS ON HAZARD. BUT THEN TALK A
LITTLE BIT ABOUT RISK AND THERE
THERE IS A DIFFERENCE BETWEEN
THOSE TWO. A CALPERS INVOLVEMENT
IN HAZARD MODELING MOST RECENTLY
HAS BEEN- THE UPDATES TO THE
FIRE HAZARD SEVERITY. ZONES THIS
IS A MAP OF STATE RESPONSIBILITY
OR AS WELL AS- IN LOCAL
RESPONSIBILITY OURS. THAT THE
TAKE IN HAZARD CONDITIONS AND-
GETTING HAZARD AND RISK
SOMETIMES GET USED
INTERCHANGEABLY- AND RISK MODELS
THAT INSURANCE COMPANIES. ARE
DIFFERENT THAN HAZARD MODELING
THAT WE USE WHEN IT COMES TO THE
MITIGATIONS THAT WE REQUIRE.
HAZARD REALLY IS BASED ON THE
PHYSICAL CONDITIONS THAT CREATE
THE LIKELIHOOD. AND THE EXPECTED
FIRE BEHAVIOR- OVER REALLY A
THIRTY TO FIFTY YEAR PERIOD-
WITHOUT CONSIDERING THE
MITIGATION MEASURES SUCH AS HOME
HARDING OR OR EVEN A RECENT
WILDFIRE SO AGAIN. THESE ARE
LONG TERM IMPACTS. AT RISK ON
THE OTHER HAND IS REALLY THE
POTENTIAL. FOR DAMAGE THAT A
FIRE CAN DO IN AN AREA USING
EXISTING CONDITIONS BUT ALSO
ACCOUNTING FOR THOSE
MODIFICATIONS SUCH AS FUEL
REDUCTION. DEFENSIBLE SPACE-
IGNITION RESISTANT BUILDING
MATERIALS SO THE MAPPING THAT
MAYBE- AT A CHAIR YOU REFERENCE
EARLY ON I REALLY WANT TO BE
CLEAR THAT IS HAZARD MAPPING WE
ARE MAKING LONG TERM DECISIONS
IN IN HOW WE BUILD HOMES- WHEN
WE WHEN WE MAP THESE AREAS WE
ARE JUST SIMPLY USING. HAZARD
FACTORS- THESE MAPS ARE
DEVELOPED USING A SCIENCE BASED
AND FIELD TESTED MODEL THAT
ASSIGNS A HAZARD SCORE BASED ON
ON FACTORS THAT INCLUDE- THE
INFLUENCE OF THE LIKELIHOOD OF
FIRE AND THE FIRE BEHAVIOR THAT
WE LIKELY WILL SEE. IN THAT AREA
NOW OFTEN I YOU KNOW I GET ASKED
BUT I LIVE IN A SUBDIVISION WHY
AM I IN A FIRE HAZARD AREA. AND
THE MODEL THAT WE'RE CURRENTLY
USING BASED ON BETTER SCIENCE
REALLY IS ABLE TO TAKE INTO
ACCOUNT- A YOU TAKE INTO ACCOUNT
EXTREME WEATHER CONDITIONS US
SPECIFICALLY WIN. THAT CAN PICK
UP AMBER THAT ARE PRODUCED UP TO
A MILE. AND CARRY THE EMBERS
INTO MORE- URBANIZED SUBDIVISION
AREAS AND WE HAVE SEEN FIRE
AFTER FIRE- THE NORTH BAY
OBVIOUSLY- HIT. SOME OF THE
HARDEST- IN THE LAST FIVE YEARS
WHERE THEY ARE URBAN.
COMMUNITIES THAT ARE STILL
IMPACTED AND SO THOSE AREAS
STILL ARE GOING TO RECEIVE A
LEVEL OF HAZARD. EVEN IF THEY
DON'T HAVE WILD LAND RIGHT NEXT
DOOR TO THEM. SOME OF THE OTHER
FACTORS DON'T HAZARD THAT WE
TAKE INTO ACCOUNT TO INCLUDE THE
VEGETATION TYPE. OBVIOUSLY THE
THICKER THE VEGETATION THE
TALLER THE TREES THE MORE EMBERS
THEY'RE GOING TO PRODUCE THE
MORE SIGNIFICANT FIRE BEHAVIOR
YOU'RE GOING TO SEE. I'D SO
FLAME LINKS- EMBERS AS I
MENTIONED THE TERRAIN TYPICAL
FIRE WEATHER IN THAT AREA I'M
ARE ALL CRITICAL COMPONENTS OF
OUR OVERALL HAZARD. MAPPING
WHICH AGAIN IS HAZARD MODELING-
BUT SWITCHING GEARS A LITTLE BIT
INTO WILDFIRE RISK MODELING OVER
THE LAST COUPLE OF YEARS OUR
OFFICE HAS BEEN ENGAGED WITH A
NUMBER OF STAKEHOLDERS-
INCLUDING- FIRE CHIEFS-
INSURANCE EXPERTS- AND MANY
OTHERS- TO DEVELOP A LIST OF
RECOMMENDATIONS FOR YOU- ON HOW
TO UNDERSTAND. WILDFIRE RISK
MAPPING- AND WILDFIRE RISK WHEN
IT COMES TO COMMUNITIES OF AN
INDIVIDUAL HOMES. AND I'LL JUST
POINT BACK TO ASSEMBLY BILL SIX
FORTY TWO- BY YOUR COLLEAGUE
ASSEMBLY MEMBER FRIEDMAN- IN TWO
THOUSAND ONE. I DIRECTED US TO
IDENTIFY THE WILDFIRE MITIGATION
FACTORS- THAT WOULD NEED TO BE
INCLUDED IN A RISK MODEL TO
DETERMINE AS WELL AS HOW TO
DETERMINE. HOW DO WE GET THAT
DATA. AND TO IDENTIFY THE
BARRIERS THAT IT TAKES. TO
ACTUALLY TRULY. CREATE A WHILE
RISK MODELING. NOW THE ARE A
RISK MY WORK THAT IS A UP OF A
OF STAKEHOLDERS AGAIN FIRE
CHIEFS INSURANCE INDUSTRY. NANCY
WALK INTO YOU WILL HEAR FROM IN
A MOMENT HAS ALSO BEEN- JUST
INVALUABLE IN HELPING MAKE SURE
THAT AGAIN WE HAVE ALIGNMENT IN
WHAT THOSE RISK FACTORS- LOOK
LIKE AND SO. BY REALLY BRINGING
IN OUR SUBJECT MATTER EXPERTS
FROM VARIOUS FIELDS WE'VE BEEN
ABLE TO- TO WORK TO ADDRESS- YOU
KNOW STATEWIDE CONCERN ABOUT
WILDFIRE RISK. MODELING AT
WORKGROUP IS JUST FINALIZING THE
DOCUMENTS- IN IN THE COMING
MONTHS- WE LOOK FORWARD TO
BRINGING SOMETHING BACK TO THAT
THAT LAYS OUT. THE COMPLEXITIES
THAT REALLY ARE- NEED TO BE
TAKEN INTO ACCOUNT- WHEN WE TALK
ABOUT WILDFIRE RISK BUT THE
BOTTOM LINE IS. THAT DURING OUR
EFFORT- IT'S BEEN MADE VERY
CLEAR TO US THAT IT IS A COMPLEX
ISSUE. WE HAVE TO HAVE ALIGNMENT
AS I TALKED ABOUT EARLIER ON THE
CORE ELEMENTS OF THE FACTORS WE
ARE INCLUDING. ACCESS TO THAT
DATA IS CRITICAL AND THEN MAKING
THAT DATA ACCESSIBLE TO- THE
FIRE SERVICE BUT ALSO TO THE
GENERAL PUBLIC- IS GOING TO BE
IMPORTANT PART. OF THE WORK AND
SO WE HAVE TO MAKE SURE THIS
INFORMATION IS TRANSPARENT SO I
WILL END- TODAY WITH THE
OBVIOUSLY THE PEAK OF OUR FIRE
YEAR IS JUST AHEAD OF US WE'VE
ALREADY SEEN EVEN WITH. ALL OF
THE RAIN WE'VE ALREADY SEEN-
OVER SIXTEEN HUNDRED WILDFIRES
ACROSS THE STATE AND SO-
CALIFORNIANS NEED TO TAKE STEPS
NOW TO PREPARE THEIR HOMES I'LL
TELL YOU. I'VE BEEN OUT ON THE
WEEKENDS DOING MY DEFENSIBLE
SPACE MAKING SURE MY HOME IS
HARD TO MAKE SURE MY COMMUNITY I
TO LIVE IN. A FIRE WISE
COMMUNITY- ALL CALIFORNIANS IN
IN IN WILDFIRE AREAS NEED TO
TAKE THE STEPS NOW- TO ENSURE
THAT- WHEN. WE GET TO THE PEAK
OF FIRES A YEAR- THAT THAT
EVERYBODY IS READY SO I REALLY
DO THANK YOU FOR THE OPPORTUNITY
TO TALK ABOUT OUR MITIGATION
EFFORTS AND- AFTER MY COLLEAGUES
ARE DONE HAPPENED ANSWER ANY
QUESTIONS YOU MIGHT HAVE. THANK
YOU. I THANK YOU MY NAME IS
FRANK RESULTS AND THE DIRECTOR
OF THE WILDLAND URBAN INTERFACE
INSTITUTE WITH CAL POLY- THANK
YOU- CHAIR CALDERON INSURE
RODRIGUEZ FOR HOSTING US. AND I
WANT TO BE SURE HOW TO MAKE SURE
UNDERSTAND OUR TIME FRAME HERE I
HEARD WE HAD A HARD STOP AT AGE.
ELEVEN IS THAT CORRECT. WE DID.
SO IT'S BEEN EXTENDED A BIT.
OKAY TRYING TO GO TO. ALL RIGHT
I'M ACTUALLY GONNA TO SLIDE AND
JUST GET TO A COUPLE OF POINTS.
TO SOME QUESTIONS I HEARD- I
WOULD ENCOURAGE YOU TO REVIEW
THE WRITTEN COMMENTS THEY
SUBMITTED. THEIR DETAILED AND
THE ANSWER MANY OF THE QUESTIONS
YOU ASK TODAY. SO I'M GONNA DRAW
DOWN A COUPLE. IN GENERAL MY
POSITION YOUR QUESTIONS ABOUT
CAP MODELS- I'M SAYING CAT
MODELS. AND WHAT THAT MEANS IS-
YOU'VE ASKED SOME. IMPORTANT
QUESTIONS ABOUT- SHORTY OR
ACCURACY OR HOW DO WE DO THOSE
THINGS. OF FROM OUR
COLLABORATIVE WORK WITH CAT
MODELERS WE UNDERSTAND THAT
THERE ARE SEVERAL THINGS THAT
THEY DON'T HAVE IN THERE THAT
THEY WOULD GREATLY BENEFIT FROM
IT WOULD PROVIDE MORE OF THE-
GRANULARITY THAT WE NEED. AT THE
END OF THE DAY. WHATEVER
DIRECTION YOU GO FOLLOW THE
SCIENCE WHAT GOT WHAT WHAT
ALIGNS ALL OF US IS. THE PHYSICS
OF HEAT TRANSFER. IF WE ALL
AGREE THAT WE DON'T WANT THE
BUILDINGS TO BURN DOWN. THAT IS
SIMPLY A FUNCTION OF
UNDERSTANDING HOW DOES THAT
HAPPEN. AND REALLY THREE WAYS
AND ALL OF OUR WORK HERE'S A
RESPONSE TO. CATASTROPHIC
CONFLAGRATION LEVELS OF LOSS OF
PROPERTY IN LIFE. AND I REALLY
COMMEND YOU FOR DOING A JOINT
EMERGENCY MANAGEMENT. AND
INSURANCE COMMITTEE MEETING
BECAUSE THESE TWO ARE
INSEPARABLY CONNECTED. SO THE
DISRUPTIONS FOR PATHWAYS ARE
THREE. VEGETATION VEGETATION
WITHIN ONE HALF TO ONE QUARTER
MILE OF CONCENTRATIONS OF A
HUNDRED STRUCTURES ARE MORE.
WITH SEPARATION DISTANCES WILL
AVERAGING LESS THAN ABOUT A
HUNDRED FEET. ON THE RIGHT ONE
CONDITIONS THAT WHEN YOU THAT'S
WHEN YOU HAVE COMPLICATIONS. THE
SECOND PART THAT WE NEED. THAT'S
NOT AVAILABLE CAP MODELERS. IS
AN ACTUAL MEASUREMENT OF FIRE
SUPPRESSION CAPABILITY TO
DISRUPT TRANSITION FROM
VEGETATION AND TO STRUCTURE AND
STRUCTURE STRUCTURE- WORKING
OBEYS A SET. VERSION OF THAT NOW
BUT IT'S NOT A TOOL THEY
CURRENTLY HAVE FIFTY NEED
BECAUSE THAT'S A SIGNIFICANT
MITIGATION. IF YOU CAN GET THE
RIGHT RESOURCES ON TIME. AND AT
THE RIGHT PLACE YOU CAN STOP
THAT TRANSMISSION. THE THIRD
THING THAT THEY DON'T HAVE THAT
THEY NEED IS A TRUE STRUCTURE TO
STRUCTURE FIRE SPREAD MODEL.
WHERE STRUCTURES ARE THE PRIMARY
FUEL TO IT. THAT DOESN'T EXIST
MOST OF THE- MODELS THAT DO THAT
SUBSTITUTE UNKNOWN FUEL MODEL
FOR VEGETATION FOR STRUCTURE.
AND YOU CAN'T COUNT FOR
MITIGATIONS IN THAT THE KEY TO
THIS AS CHEAP BLATT SAID. MOST
OF THIS WORK HAS TO BE DONE BUT
PROPERTY OWNERS WE HAVE
SITUATIONS WHERE THEY CAN'T. DO
MEANS OUR COMPLEXITY AND THAT'S
WHERE WE HAVE GRANT FUNDING WE
HAVE OTHER WAYS TO DO THAT. BUT
TO BUT TO PROVIDES HOMEOWNERS
PROPERTY OWNERS CLEAR GUIDANCE.
TO CHIEF PLANTS POINT WE HAVE TO
HAVE A LINE AND THAT LINE HAS TO
BE AROUND THE MITIGATIONS. THAT
ARE EVIDENCE BASED. TO HELP
DISRUPT FIRE PATHWAYS. AND THE
LAST PIECE THAT WE NEED IS DATA
AND HERE'S A SPECIFIC REASON WE
DON'T HAVE WHAT WE NEED IN THAT
SPACE. I'M NOT TRYING TO BE AN
INSURANCE PERSON HERE BUT I
SPEND A LOT OF TIME AND
ESPECIALLY WITH THE AS OF THE
LAST FEW YEARS. DEUTSCHE APRIL
AFTER I'VE LOOKED AT THIS I'VE
BEEN IN THE FIRE SERVICE TO
SEVENTY NINE AND ALL THAT'S BEEN
THIS YEAR ABOUT US. WE LOOK. AT
STRUCTURE TO STRUCTURE SPREAD WE
GET THESE CONFLAGRATIONS.
INSURANCE INDUSTRIES- THE
INTERESTED AS TO PRESSURES ON IT
THAT DON'T REALLY FOSTER DATA
SHARING. ONES WERE CONCERNED
ABOUT SO MANY TRUST ISSUES FOR
GOOD REASON. AND THE OTHERS
MARKET ISSUES RIGHT- YOU DON'T
WANT A BIG SATURATION OF RISK IN
ONE AREA SO YOU TEND TO
DISPERSE. WHAT YOU UNDERRATE. I
BELIEVE THERE'S BEEN. MAYBE A
DISCONNECT BETWEEN. AGGREGATE
RISK OF PHYSICALLY SEPARATED
PROPERTIES IF ROLE MITIGATED
PROPERLY LET'S SAY A 100% THAT'S
NOT THE SAME. AS WHAT YOU'RE
JASON RISK IS AND THEY CAN'T
KNOW THAT RIGHT NOW. SO IT'S
STRUCTURED STRUCTURE SPREAD IS
WHAT RESPONDING TO WE CURRENTLY
DON'T HAVE THAT LEVEL OF DATA
SPREAD. SO WHEN I SAY. YOU KNOW
THAT THE DISCUSSION SOUNDS TO ME
LIKE IT'S GOING IN THE RIGHT
DIRECTION I BELIEVE CAP MODELS
HAVE A VERY IMPORTANT PLACE. IN
WHAT WE'RE DOING. I THINK WE
ALSO NEED THESE OTHER ELEMENTS
I'VE DISCUSSED. AND WE NEED
THOSE THAT PART TO BE
TRANSPARENT. BECAUSE YOUR LOCAL
GOVERNMENT AND YOUR STATE
GOVERNMENT NEED TO KNOW. WHAT IS
FIRE SPREAD LOOK LIKE AND ALL
THREE OF THOSE AREAS HOW DO WE
DISRUPTED. AND THAT TELLS YOU
WHAT MITIGATION SHE NEEDED ON BY
THE WAY YOU DON'T NEED TO DO
EVERYWHERE THEIR THEIR OPTIMAL
PLACES TO PUT THAT. WHEN YOU DO
FLOOD PROTECTION- PUT A SIX FOOT
MODE AROUND A COMMUNITY YOU. YOU
MITIGATE IN CERTAIN AREAS FIRE
PATHWAYS- THEY THEY RESPOND TO
THINGS WE CAN MODEL THOSE WELL.
SO THAT PART NEEDS TO BE
TRANSPARENT SO THAT WE CAN
PROBABLY MANAGE AT RISK FROM THE
GOVERNMENT SIDE AND IT ALSO
NEEDS TO BE EXTRACTED AND USED
FOR PROPRIETARY PURPOSES FOR ALL
THE MARKET REASONS YOU
UNDERSTAND. WE DON'T HAVE THAT
YET EITHER. AND THE NEXT BIGGER
ABOVE IS. AN EXPERT IN THE ADAM
AND WHAT WILL WILL COVER SOME OF
THAT SO. TO RECAP. CAD MODELS
END. THE END PIECE HAS TO BE
STRUCTURE STRUCTURE SPREAD
MODELING WE'RE NOT QUITE THERE.
ABLE TO MEASURE. THE ABILITY OF
YOUR LOCAL FIRE SERVICES AND
STATE FIRE SERVICES TO DISRUPT
FIRE PASSWORD PATHWAYS FROM
VEGETATION STRUCTURE. AND WE
HAVE TO BE ABLE TO MODEL. MOST
PROBABLE PATHWAYS LAST HALF THE
QUARTER MILE YOU CAN'T MITIGATE
THE WHOLE FOREST. RIGHT WE NEED
TO BELT KNOW HOW TO
INTELLIGENTLY. OPTIMIZE
DISRUPTION IN THAT LAST SPACE.
THOSE NEED TO BE TRANSPARENT. SO
THAT WE CAN USE THEM AND OPEN
COVER UP GOVERNMENT SETTING. AND
THE PUBLIC CAN SEE THEY CAN
UNDERSTAND WHAT IS ART WHAT IS
OUR COMMUNITY LOOK LIKE. NOW
WITH THESE. WHAT WOULD LOOK LIKE
WITHOUT THEM. AND WE HAVE TO
HAVE THE THAT TURNED OVER
ANNUALLY. THAT'S THE WAY THAT
WE'RE GOING TO GET THERE SO
THANK YOU FOR YOUR TIME.
APPRECIATE THAT. THANKS FRANK-
UNFIT NANCY WATKINS- I'VE- VERY
GRATEFUL FOR YOU ALL HAVING ME
HERE TODAY I'M A PRINCIPAL WITH
MILLMAN AND SAN FRANCISCO AN
ACTUARY- AS AN ACTUARY- MY
PROFESSION IS FOCUSED ON
ACCURATELY MEASURING AND
COMMUNICATING RISK. MY PRACTICE
WEEK WE CONSULT FOR INSURANCE
COMPANIES INCLUDING MOST OF THE
MAJOR ONES IN CALIFORNIA. WE
ALSO WORK WITH THE NATIONAL
ASSOCIATION OF REALTORS WE
REVIEW COUNT MODELS AND HELP
STATE INSURANCE REGULATORS- COME
UP WITH MITIGATION SCHEMES THAT
ARE FAIR. OF WE'VE REVIEWED
MODELS FOR FEMA FOR- G. S. EASE-
AND WE ALSO VOLUNTEER- I
VOLUNTEER WITH THE WESTERN FIRE
CHIEFS ASSOCIATION I'M A MEMBER
OF THE- CAL FIRE ON RISK
MODELING ADVISORY WORK GROUP
THAT- CHIEF BERLIN HAVE. HAS
BEEN TALKING ABOUT AND SO- MY
WORK IS ALL AROUND- CATASTROPHIC
RISK CLIMATE RISK AND WHAT MAKES
INSURANCE MARKETS FALL APART AND
HOW DO YOU PUT HIM BACK TOGETHER
AGAIN SO- I'M SCRAPPING MY FANCY
POWER POINT BECAUSE A LOT OF THE
STUFF THAT I WAS GOING TO TRY TO
CONVINCE ALL OF YOU SEEM TO HAVE
ALREADY KIND OF GONE DOWN TO.
AND I'M GONNA TRY TO TALK ABOUT
BIGGER PICTURE THINGS THAT
YOU'VE BEEN ASKING QUESTIONS
ABOUT- FIRST OF ALL WHAT MAKES A
SUSTAINABLE INSURANCE MARKET
LIKE SOME OF THE CONCEPTS THAT
YOU'VE BEEN. ASKING ABOUT WE
HAVE TO HAVE THREE COMPONENTS
MOM THE FIRST IS AVAILABILITY
WHICH IS WHAT YOU'RE VERY VERY
FOCUSED ON NOW AS YOU SHOULD BE
AND THE NECESSARY REQUIREMENTS
FOR INSURANCE COMPANIES TO MAKE
THEIR PRODUCTS AVAILABLE IS THEY
CAN MANAGE AND MEASURE THE RISK.
AND THEY CAN CHARGE PREMIUMS
ENOUGH FOR THAT RISK TRANSFERS
SO IF THOSE TWO COMPONENTS ARE
OR THEY'RE ON THEY'RE THEY'RE
MUCH MORE LIKELY TO BE MAKING
THEIR PRODUCTS AVAILABLE ALSO.
ON AFFORDABILITY WHICH- PRIESTS
OF YOUR SELF LIKE- THE BUYER CAN
OF THE PRE. THAT THE INSURANCE
COMPANIES ARE WANT TO CHARGE AND
THEY THINK THAT THE PREMIUMS ARE
WORTH IT- AS WELL- IF THEY DON'T
HAVE TO BUY. AND THEN THE LAST
THING WHICH WE HARDLY EVER TALK
ABOUT IS RELIABILITY AND THAT IS
THAT THE FRAMEWORK THE SYSTEM IS
STABLE. AND FAIR AND PREDICTABLE
OVER THE LONG TERM- AND THAT
MIGHT INCLUDE JUDICIAL
ENVIRONMENT IT MIGHT INCLUDE THE
REGULATORY REGIME- ALSO THAT THE
INSURANCE COMPANY IS AROUND FOR
THE LONG TERM AND THAT IS
DEPENDENT ON THE ABILITY. TO
HAVE ENOUGH REINSURANCE IN A
CATASTROPHIC EVENT TO BE ABLE TO
PAY THE CLAIMS. SO WE ARE IN MY
OPINION BOMB. CRISIS IS CAUSED
BY A- LASER FOCUS ONLY ON
AFFORDABILITY. AND ELEMENT AT AT
THE EXPENSE OF AVAILABILITY AND
RELIABILITY- END VERY CRUDE
TOOLS THAT ARE DESIGNED. TO
CONTROL AFFORDABILITY THAT HAVE
ACCELERATED AND IN SOME CASES
CAUSED. MARKET CRISIS- TO GET
WORSE HAPPENING AT THE SAME TIME
THAT CLIMATE RISK BUT CLIMATE
CHANGE HAS INCREASED WILDFIRE
RISK MOM AND OTHER THINGS
HAPPENING LIKE INFLATION- SO
WHEN YOU PUT THOSE. FACTORS LIKE
CLIMATE CHANGE AND INFLATION-
AND THE REINSURANCE MARKET CYCLE
THAT ALWAYS HAPPENS- AL IN THE
WORLD YOU PUT THOSE AGAINST A
RIGID IT REGULATORY SYSTEM IT'S
LIKE YOU'VE GOT YOUR- STEERING
WHEEL LOCKS STRAIGHT AHEAD YOU
GOT YOUR- YOU KNOW SPEED SET ON
CRUISE CONTROL AND NOW YOU FIND
YOURSELF ON THE PACIFIC COAST
HIGHWAY. WHAT INSURANCE COMPANY
WOULD AGREE TO THAT WHAT WHAT
OWNERS OF INSURANCE COMPANIES OR
OR OR- YOU KNOW POLICY HOLDERS
WILL WHO WHO WOULD SAY THIS IS A
GOOD MARKET TO BE AND- THAT IS
WHY WE HAVE AN AVAILABILITY
CRISIS. SO WE HAVE TO THINK
HOLISTICALLY AND WE HAVE TO
REMEMBER WHO OWNS THIS RISK
INSURANCE COMPANIES DON'T ON THE
RISK CALIFORNIA OWNS THE RISK.
BOMB THAT'S ONE OF THE REASONS
THAT HI I HAVE. ENJOYED AND
BENEFITED SO MUCH FROM
INTERFACING WITH THE FIRE
PROFESSIONALS HERE HOME IS THERE
ARE VERY VERY INTERESTED IN. IN
DRIVING THE RISK DOWN THE IN IN
OUR CASE PRETENDING THAT THE
RISK IS LOWER THAN IT IS. ALL IT
DOES IS IT HURTS RELIABILITY AND
IT HURTS AVAILABILITY IT DOES
NOT BENEFIT AFFORDABILITY THE
ONLY WAY TO GET AFFORDABLE RATES
IS TO DRIVE THE RISK DOWN AND I
THINK EVERYBODY SORT OF
UNDERSTANDS THAT. BUT IT MEANS
GIVING UP SOME OF OUR OLD TOOLS
LIKE THAT BACKWARDS LOOKING
FORMULA- I DO HAVE ONE SLIDE I
WANT YOU ALL TO SEE- IF YOU HAVE
ANY DOUBTS A LEAVING THAT FOR.
BEHIND IT BECAUSE THE
AFFORDABILITY CRISIS SO THAT'S
SOMETHING THAT'S HARD TO
UNDERSTAND- INVOLVES MATH SORRY
FROM SO IF YOU LOOK AT SLIDE
SIX. HOME ONE RIGHT BACK IN IF
YOU IF YOU THINK BACK TO A-
PRIOR TO TWENTY SEVENTEEN. FROM
THE NINETEEN NINETY ONE OAKLAND
HILLS FIRE WAS THE MOST
DESTRUCTIVE EVENT IN STATE
HISTORY AND WHAT THAT ONE WE
LOST TWENTY NINE HUNDRED
STUDENTS STRUCTURES. SO IN
TWENTY FIFTEEN AND TWENTY
SIXTEEN- WE WERE OF. THERE THERE
WAS A RATE HEARING OF A MAJOR
INSURANCE COMPANY THAT WANTED TO
SIX POINT 9% RATE INCREASE. IN
PART BECAUSE THEIR WILDFIRE RISK
WAS INCREASING. AND THE CDI AND
TO THE CONSUMER INTERVENORS USED
THE BACKWARDS LOOKING FORMULA TO
ARGUE THAT WILDFIRE RISK WAS NOT
GOING UP IN FACT SOMETIMES THEY
ARGUE THAT THE RISK WAS GOING
DOWN. AND THEY CONCLUDED THAT
THE COMPANY HAD TO DECREASE
THEIR RATES THIS WAS RIGHT
BEFORE THIS THIS WAS WHILE WE
WERE IN A FIVE YEAR DROUGHT I
THINK YOU FEEL LIVED HERE THAN
YOU WERE YOU REMEMBER HOW ABOUT
THE DROUGHT WAS ALL THE TREES
DYING OFF. HOME AND THEN RIGHT
AFTER THAT WE HAVE THE TUBBS
FIRE TWENTY SEVENTEEN WERE THERE
FIFTY SIX HUNDRED STRUCTURES
LOST. CAMPFIRE TWENTY EIGHTEEN
CLOSE TO NINETEEN THOUSAND
STRUCTURES AND SO THE QUESTION
IS THAT A FAIR SYSTEM. DOES IT
MAKE SENSE FOR THAT INSURANCE
COMPANY TO OF HAD TO DROP THEIR
RATES IN TWENTY SIXTEEN. AND
THEN WE HAVE THESE THINGS HAPPEN
IN TWENTY SEVENTEEN SO GO TO
SLIDE SEVEN AND YOU'LL SEE WHAT
THAT. WHAT THAT DID WITH RATES-
WHEN YOU LOOK AT TWENTY YEARS OF
DATA AND THIS IS I JUST PUT
TOGETHER ONLY TINY NUMBERS BUT-
JUST MAYBE LISTEN TO THE WORDS-
I PUT TOGETHER DATA FOR THREE OF
THE TOP TEN INSURANCE COMPANIES
SO YOU CAN'T SEE WHO THEY ARE
BUT- YOU KNOW ALL TOGETHER
THERE'S A PRETTY LARGE MARKET
SHARE- TWENTY YEARS OF DATA
THREE TWENTY SIXTEEN. THE
CATASTROPHE LOAD WAS ABOUT 11%
SO FOR EVERY DOLLAR OF NINE
CATASTROPHE HOMEOWNERS LOSSES WE
WILL GET ANOTHER ELEVEN SENSE OF
WILDFIRE AND THAT TRANSLATES TO
ABOUT. YOU KNOW DOLLAR LEVIN OF
PREMIUM. YOU ADD IN THE TWENTY
SEVENTEEN YEAR AND THE CAT LOAD
DOUBLES IT GOES TO TWENTY THREE
PERCENT. YOU ADD IN THE TWENTY
EIGHTEEN YEAR CAN YOU CLICK.
CLICK CLICK OKAY THERE WE GO-
ADD IN THE TWENTY EIGHT YEAR AND
THE CAT LOAD INCREASED TO FIFTY
THREE PERCENT. SO A FIVE FOLD
INCREASE IN THE CAT LOAD BY
ADDING TWO YEARS OF DATA. FOR
THE FOR THREE OF THE TOP
INSURANCE COMPANIES IN THE
STATE. SO ARM IN TWO YEARS. THAT
WOULD HAVE. INDICATED A 38%
STATEWIDE RATE INCREASE. ON
HOMEOWNERS. SO IF WHEN WE HAVE
THE SIX POINT 9% SORT OF
IMPLICIT CAP ON WHAT INSURANCE
COMPANIES CAN ASK FOR WITHOUT
GOING TO OF A RATE HEARING. THAT
WOULD TAKE FIVE FILINGS TO GET
THEIR- HOME. AND IT'S HARD YOU
KNOW FOR INSURANCE COMPANIES TO
JACK THE RATES UP BY 38% IN TWO
YEARS THEY DON'T WANT TO DO THAT
IT'S NOT GOOD FOR THEIR MARKET
IS NOT GOOD FOR AGENTS IT'S NOT
GOOD CAN FOR CONSUMERS. THIS IS
WHAT THE BACKWARD LOOKING
FORWARD OF FORMULA ALLOWED AND
ACTUALLY DICTATED FOR RATE
ADEQUACY IN CALIFORNIA SO NO ONE
SHOULD BELIEVE THAT THE- THAT
THE RISK INCREASED FIVE FOLD THE
FORMULA DOESN'T WORK TO MEASURE
WILDFIRE RISK. HOME IT JUST ONE
MORE SLIDE THE NEXT ONE. ON
SHOWS LIKE THE GREEN LINE IS.
CAP MODEL RATES THE BLUE LINE IS
EXPERIENCE FORMULA RATES- WE DID
A STUDY BASED ON LIKE 10% OF THE
RISKS IN THE STATE IF YOU WROTE
ACROSS THE WHOLE STATE OF
CALIFORNIA. AND USE A
CATASTROPHE MODEL IF YOU'RE
GROWING IN THE WILL IF YOU'RE
TAKING ON MORE RISK WHAT IS THE
CAT MODEL DUTY A RATE INCREASE
THAT'S THAT'S MOVE GREEN LINE.
HOME ON THE LEFT IF YOU'RE
SHRINKING IN THE WHOOPIE THAT'S
THE GREEN LINE ON THE RIGHT YOUR
YOUR RATES ARE SLOWLY DRIFTING
DOWN. WITH THE CDI FORMULA IT'S
THAT BLUE LITTLE HORSESHOE LIKE
SHAPE THAT THAT SHAPE IT HAS
NOTHING TO DO WITH INCREASING OR
DECREASING RISK IN THE REALLY IT
JUST RESPONDS TO THE EXPERIENCE.
SO THE POINT IS THE FORMULA
WON'T LET INSURANCE COMPANIES.
TAKE ON MORE RISK IT
INCENTIVIZES THEM TO DROP DROP
RISKS SO THEY DON'T HAVE TO ASK
FOR RATE INCREASES. IT PENALIZES
THEM IF THEY WANT TO ADD MORE
WILDFIRE RISK THEY CAN'T GET
MORE PREMIUM UNTIL AFTER THE
LOSSES HAPPEN SO WHY WOULD
ANYONE RIGHT NOW TAKE POLICIES
OUT OF THE FAIR PLAN. THAT'S WHY
THIS FORMULA REALLY HAS TO BE
THOUGHT OF AS AS A KEY OBSTACLE
FOR AVAILABILITY IN CALIFORNIA.
ON THE OTHER QUESTIONS THAT
PEOPLE HAVE BEEN ASKING IS THIS
THE HOLY GRAIL IS THE SILVER
BULLET THE ANSWER IS NO IT'S
NECESSARY BUT NOT SUFFICIENT THE
REINSURANCE- COST IN CAL IN
CALIFORNIA IS A REAL COST OF
DOING BUSINESS. CALIFORNIA IS
THE ONLY STATE THAT DOES NOT
ALLOW FOR CATASTROPHIC
REINSURANCE COSTS TO BE PASSED
ALONG THROUGH RATES WE DO ALLOW
IT FOR EARTHQUAKE- IT DID NOT
BREAK THE EARTHQUAKE MARKET WE
ALLOW CAT MODELS TO BE USED FOR
FIRE FOLLOWING EARTHQUAKE. AND
FOR EARTHQUAKE INSURANCE OUTSIDE
OF THE CA. I DON'T KNOW IF ANY
CONSUMERS HAVE EVER COMPLAINED
ABOUT THAT I DON'T BELIEVE THAT
I'VE EVER HEARD IN ANY CAP MODEL
HAD ALL OF THEIR I. P. IN THEIR
ALGORITHMS AND THEIR DATA.
PUBLISH STE ON INTERNET ALL
THEIR COME TO SEE SOMEHOW
CALIFORNIA HAS MANAGED TO
REGULATE EARTHQUAKE INSURANCE
AND FIRE FOLLOWING EARTHQUAKE
WITHIN A HOMEOWNER'S POLICY
WITHOUT DOING ALL THE THINGS
THAT. SEEM TO KEEP COMING UP
WHEN IT COMES TO QUÉ WHILE FAR
CATASTROPHE MODELS OTHER STATES
HAVE INTERNAL EXPERTS OR STATE
COMMISSIONS OR THEY HIRE
EXPERTS. TO REVIEW CAP MODELS-
IT'S SOMETHING OUR GROUP DOES I
ACTUALLY THINK CALIFORNIA COULD
BENEFIT FROM JOINING UP WITH
OTHER STATES THAT HAVE SIMILAR
PROBLEMS THERE'S A LOT OF STATES
IN THE WEST. THESE THESE MODELS
ARE NOT STATE SPECIFIC. SO THESE
BIG COMPANIES- ALIKE VARISCAN
RMS AND CORELOGIC THAT YOU'VE
HEARD ABOUT TODAY- THEY COULD
PUT A MARK OF MODEL THROUGH ONE
REVIEW FOR ALL. YOU DO STATES
WHERE THE WILDFIRES IN ISSUE AND
THE STATE'S COULD JOIN UP AND
HIRE EXPERTS TO DO A GREAT JOB
AND REALLY KICK THE TIRES AND
REALLY MAKE SURE. THAT THEY'RE
DOING THEIR DUE DILIGENCE AND
THEN PROTECT THE IP OF THE
MODELERS SPLIT THE COST. AND
THEY'LL HAVE THE INFORMATION
THAT THEY'LL NEED IN ORDER TO.
YOU KNOW TO DO THEIR JOB OF
REGULATING THE TO MAKE SURE THAT
THE MODELS ARE SUITED FOR THE
PURPOSE. SO ARM I DO THINK THAT.
OUR CULTURE IN CALIFORNIA WITH
RESPECT TO ALL INSURANCE HAS
BEEN. IT'S BEEN VIEWED AS AS AS
KIND OF A WIN LOSE OF THE FALSE
DICHOTOMY. IF POLICY HOLDERS ARE
GONNA WIN INSURANCE COMPANIES
HAVE TO LOSE AND I THINK WE
REALLY NEED TO GET AWAY FROM
THINKING ABOUT THAT STOP
THINKING JUST ABOUT DRIVING
PREMIUMS DOWN AND START THINKING
ABOUT DRIVING THE RISK DOWN.
THANK YOU. THANK YOU- WE'LL SEE
IF WE HAVE ANY QUESTIONS FROM.
MEMBERS FULLER. SORRY I'M SORRY
I KNOW EVERYBODY'S TRYING TO GET
OUT HERE BUT I AM. SO I HEAR
WHAT YOU'RE SAYING. AND I AGREE
I. BUT THE PROBLEM IS HOW TO
PEOPLE FOR IT. IF YOU'RE TALKING
ABOUT A 37% INCREASE OR A 56%
INCREASE. HOW TO PEOPLE FOR THAT
YOU KNOW THAT'S THAT'S ONE OF
THE FEARS THAT I HAVE- IN MY
MIND MOVING TO THIS MODEL RIGHT
AND WHEN YOU USE THE EXAMPLE OF
IT HASN'T COLLAPSED THE-
EARTHQUAKE MARKET. BUT THERE'S A
LOT OF PEOPLE WHO DON'T GET
EARTHQUAKE INSURANCE BECAUSE
IT'S UNAFFORDABLE- IT SO AT I
DON'T FEEL LIKE IT'S A- APPLES
AND APPLES COMPARISON- SO HOW DO
YOU LIKE HOW DO YOU SUGGEST
FINDING THAT SWEET SPOT. OF
INSURANCE COMPANIES NEEDING TO
BE ABLE TO COVER. POTENTIALLY
WHAT THEY'RE GOING TO HAVE TO
PAY OUT AND WE KNOW THEY LIKE TO
MAKE A PROFIT AS WELL- VERSES.
YOU KNOW WHAT PEOPLE CAN AFFORD
TO PROTECT THEIR INVESTMENTS.
THAT'S AN ISSUE IN LOTS OF
PLACES CALIFORNIA'S IS HOME.
YOU'RE JUST ONE OF THEM- BUT I
GUESS I'D SAY THE FIRST WAY TO
GET AFFORDABILITY IS COMPETITION
INSURANCE COMPANIES I MEAN
THERE'S SUCH. A CULTURE OF NOT
COLLUDING AND NOT COOPERATING
THEY THEY HAVE A VERY VERY
DIFFERENT GOALS AND DIFFERENT
VIEWS OF RISK AND THEY IF YOU
HAVE A BUNCH OF DIFFERENT
COMPANIES WHO WANT TO QUOTE YOUR
POLICY THERE WILL BE SOME THAT
ARE LOWER THAN OTHERS. AND SO
THE NUMBERS THAT I SHOWED ON THE
ON THE SLIDE WERE NOT WHAT THE
CAT MODELS WOULD DO IT WITH WITH
THE FORMULA IN CALIFORNIA DID. I
THINK IN SOME CASES INSURANCE
COMPANIES DIDN'T NEED THAT MUCH
RIGHT BUT THEY SHOULD HAVE BEEN
ABLE TO INCREASE RATES OVER TIME
AS THE RISK WENT UP SO I THINK.
YOU KNOW ON A MACRO LEVEL
COMPETITION DEFINITELY HELPS ON
PREDICTABILITY HELPS KNOWING
WHAT KIND OF HOUSE YOU CAN
AFFORD AND WHERE CAN YOU AFFORD
IT THAT MAKES A VERY BIG
DIFFERENCE WITH RESPECT TO
AFFORDABILITY OM BUT THE BIGGEST
ISSUE IS MEDICATION I MEAN ONE
OF THE THINGS ABOUT I'M NOT
GONNA. I'M SORRY I'M LOOKING AT
YOU TURN MY BACK ON THE MOST
IMPORTANT PEOPLE IN THE ROOM
RIGHT NOW FOR ME THESE GUYS HAVE
TAUGHT ME SO MUCH ABOUT HOW
MEDICATION WORKS AND FIRE CAN
REALLY BE MEDICATED WE CAN
ACTUALLY DRIVE THE RISK DOWN.
AND DON'T JUST THINK ABOUT
INSURANCE PREMIUMS IN
AFFORDABILITY WHICH DOES MATTER.
BUT THINK ABOUT HOW MANY LIVES
WILL BE SAFE THINK ABOUT HOW
MANY COMMUNITIES WON'T BE BURNED
DOWN THINK ABOUT HOW MANY FIRES
WON'T BE BURNING AT THE SAME
TIME WE'RE- YOU KNOW CAL FIRE
SPREAD ALL OVER THE PLACE. AND
CAN'T DO AS GOOD OF A JOB TO
PRESERVE THE FIRES OF ART TO
PRESERVE THE HOMES. THOSE ARE
THE THINGS THAT WILL HAPPEN IF
WE HAVE. THE INFORMATION TO
MITIGATE AND WE- THESE. TWO GUYS
AND I AND OTHERS INCLUDE IN MY
PETERSON FROM CD WHOSE. YOU KNOW
PART OF OUR R. D. FOR THE START.
WE BEEN FOCUS VERY HARD ON. HELL
TO INCENTIVIZE MITIGATION AT
SCALE NOT JUST HOME LEVEL BUT
COMMUNITY LEVEL AND HOW TO GET
THE WORDS AND THE DATA AND THE
CONCEPTS OUT THERE AS FAST AS
POSSIBLE. AND HAVE THEM ADOPTED
BY THE INSURANCE INDUSTRY. THE
INSURANCE INDUSTRY WANTS TO
WRITE IN CALIFORNIA THEY WANT TO
BE ABLE TO TELL THE SHEEP FROM
THE GOATS RIGHT NOW THEY CAN'T
THEY CAN'T TELL THE DIFFERENCE
BETWEEN. YOU KNOW A VERY VERY
HARD AND COMMUNITY AND ONE THAT.
YOU KNOW IS JUST DOING WHAT THEY
ALWAYS DID. AND THEY DON'T LIKE
THAT THAT'S THAT HAVE THAT HURTS
IN TERMS OF RISK MANAGEMENT AND
RISK MEASUREMENT THAT'S TRUE FOR
REINSURERS TO WE'VE DONE A
NUMBER OF DISCUSSIONS WITH
REINSURERS AND INSURERS. THAT
ARE BIG IN CALIFORNIA AND SAID
THIS IS WHAT WE THINK WE SHOULD
DO WILL THIS HELP DO YOU THINK
WAS THE THING FOR YOU TO JOIN US
WILL WILL YOU. RELAX YOUR NORMAL
POSTURE OF NEVER COOPERATING
WITH ANYBODY AND TRY TO GET
TOGETHER ON THIS DATA INITIATIVE
AND TRY TO HELP. YOU KNOW GET
CAT MODELS TO BE MORE. ARE ABLE
TO SEE WHAT'S GOING ON TO DRIVE
DOWN THE COST OF INSPECTIONS
MAKE THE MORE FREQUENT MAKE THEM
AGGREGATE A BALL WITHIN A
COMMUNITY. AND NOBODY HAS SAID
NO TO US MAYBE BECAUSE FRANK
AND- DAVE WINOKUR AND YOU KNOW
THE CAL FIRE CONNECTIONS YOU
KNOW. MAKE IT HARD TO SAY NO
BUT- THEIR THEY'RE THEY'RE ON
BOARD SO FAR. BUT I THINK IT
ACTUALLY. IS GOOD NEWS I THINK
IT'S HOPE. MAY I. WILL GOOD TO
KNOW THAT YOU ACTUALLY SOLVE
THIS PROBLEM ONCE. SOLD IT FOR
MANY YEARS. HOW TO YOUR FAMILIAR
WITH THE UNFUNDED ACCRUED
LIABILITY IN PERSON. WELL
ESSENTIALLY. WE CONTRACTED
THERE'S THREE THOUSAND ROUGHLY
AGENCIES TWO MILLION PEOPLE I
THINK COVERED IN IT. AND WE
REALIZED. SOME TIME AGO WE
SHOULD HAVE A DISCONNECT
BETWEEN. THE UNDERSTANDING OF
THE PURSE COMPENSABLE ITEMS THAT
WERE IN. THOUSANDS OF LABOR
CONTRACTS. WHAT WAS REALLY PURSE
COMPENSABLE AND OF THE SYSTEM
MOVIE DISCOVERED THAT.
DIRECTORIAL SCIENCE BY THE WAY.
WE REALIZE- WE GET A DISCONNECT
BETWEEN THE FINANCIAL RISK THAT
WE TOOK ON IN THE ACTUAL
FINANCIAL RISK. RESPONSIBLE FOR.
THE BAD NEWS ABOUT THAT ONE IS
THIS FINANCIAL EXPENSES WE KNOW
THAT IF YOU'RE ADMINISTRATOR YOU
READY YOU A. L. CONTRIBUTION
EVERY YEAR IN ADDITION IRREGULAR
. I BELIEVE WE HAVE AN UNFUNDED
ACCRUED WILDFIRE RISK LIABILITY
. CLIMATE CHANGE ACCUMULATION
FUELS AND DEVELOPMENT AND THE
WORRY I'VE BEEN THE INCREMENTAL
CHANGES OVER TIME. HISTORICAL
DATA DOESN'T WORK ANYMORE
BECAUSE IT'S OUTSIDE. OF THE
CURRENT CONDITIONS ON THE GROUND
. AND SO NOW THAT WE REALLY
UNDERSTAND THE RISK. THERE'S TWO
THINGS ONE IS WE HAVE TO
PROPERLY. PRICE THAT RISK INTO
THE FUTURE BY THE WAY IF WE
DON'T. WHAT'S WHAT'S HAPPENED A
MORTGAGE INDUSTRIES OR MUNICIPAL
BOND. RATINGS IF THE TRUE RISK
IS UNDERSTOOD I'M WE'RE WE HAVE
A HUGE GAP. ELYSIUM EDUCATION
STATE THAT WHERE THEY GO. THE
GOOD NEWS IS TO YOUR POINT. WE
DON'T HAVE TO DIRECTLY THROUGH
DOLLARS A LOT OF THIS WE SHOULD
THERE'S A LOT OF ERRORS THAT WE
ARE WILL NEED TO CONTINUE. BUT
IF WE COULD GET. TO CHIEF PLANTS
POINT. UNALIGNED MESSAGE. OUT
THERE TO HOMEOWNERS AND
COMMUTERS ON WHAT'S ACTUALLY
EFFECTIVE AND WHAT'S GOING TO BE
RECOGNIZED IN MATERIAL WAY
MEANINGFUL TO THEM. THAT'S WHERE
THE SOURCE HAS TO CAST IT ON THE
SCALE. AND SO THE WAY WE BUY
DOWN THAT RISK THAT OCCUR
UNFUNDED ACCRUED WEALTH FOR RISK
LIABILITY IS THROUGH MITIGATION
. IN SOME CASES. THAT COULD BE
AS SIMPLE AS YOU KNOW AN
AFTERNOON WITH A GOOD DRINKING A
RAKE AND OTHER CASES IT'S GOING
TO REQUIRE GRANT SUPPORT BECAUSE
YOU GOT A HUNDRED FOOT TREE
BETWEEN. TWO OR THREE STRUCTURES
ARE TWENTY FEET APART. BUT WITH
BETTER DATA AND ALIGNMENT BEHIND
THE MESSAGE AND A STRATEGIC
SYSTEM WHICH IS ADDRESSED MY
WRITTEN COMMENTS. WE CAN NOW
TAKE THIS THIS. ON A POLICY
FEDERAL AGENT WE HAVE INPUT THAT
INTO AN EFFECTIVE. MITIGATION
HEARTBEAT THERE'S A WAY TO DO
THIS SMARTER BUT IT REQUIRES US.
TO WORK IN A AB TRANSLITERATE
PROSJE. IN SO THAT'S IF YOU'VE
GOT A BACKGROUND YOU'VE GOT A
REAL COHORT OUT THERE SORT OF
UNOFFICIALLY WORKING IN SOME
OTHER AREAS AND IT CONNECTS UNIT
CAN IT'S THEIR- BUT WERE. WERE
CLOSE. TO STARTING TO HIT
CRITICAL MASS ON THAT. CAT
MODELS IS A STEP IN THE RIGHT
DIRECTION I BELIEVE. AND WE NEED
TO DO THESE OTHER THINGS TO HELP
THAT BE MORE GRANULAR MORE
ACCURATE AND SEND A CONSISTENT
MESSAGE. TO ALL THE STAKEHOLDERS
FOUR FOUR GROUPS HAVE TO BE A
LIME. THE STATE INSURANCE
COMMISSIONER- GUIDANCE. THE
ENTRANCE TRAITS IN EACH STATE
I'M DOING THIS WORK IN
CALIFORNIA OREGON WASHINGTON
NEVADA COLORADO WE HAVE TO GET.
IN EACH STATE WERE TAKEN THE
SAME APPROACH. IT HAS TO BE. THE
STATE ORGANIZATION RESPONSIBLE
APPROVED CODE BECAUSE THAT SETS
TRUE NORTH FOR ALL OF THE OTHER
AGENCIES. COUNTIES CITIES
SPECIAL DISTRICTS. THE LOCAL
FIRE AGENCIES TO COMPLETE THAT
LAST MILE. AND SO THOSE ARE THE
FOUR GROUPS THAT NEED A
CONSISTENT. ALIGNMENT AROUND
CORPS MITIGATIONS AT THE PARCEL
LEVEL AND THE PROPERTY LEVEL.
THAT ARE EVIDENCE BASED FROM A
FIRE PERSPECTIVE WHICH MEANS
THEY'RE THEY'RE NOW EVIDENCE
BASED ON ACTUARIALLY FINANCIAL
BASE BECAUSE- THEY WORK. SO HELP
US FOLLOW THE SCIENCE. THANK
YOU. THANK YOU ASSEMBLY WOMAN
WALDRON TO IMPRESSION THANK YOU
MADAM CHAIR- SO AS ONE WHO LIVES
IN A VERY HIGH FIRE RISK AREA.
AND HAS BEEN ON THE FAIR PLAYING
A COUPLE TIMES AND HAS BEEN NON
RENEWED SO MANY TIMES THAT I
CAN'T REMEMBER IN THE DIFFERENT
HOMES THAT HAVE HAD- I KNOW I
ALWAYS SAID THE FAIR PLAN WAS
UNFAIR. BECAUSE WE WENT FROM I
MEAN TALK TALK ABOUT TEN TO
TWELVE YEARS AGO IT WILL ONLY
COST A THOUSAND DOLLARS. TO
ENSURE THE HOUSE AND ON THE FAIR
PLAN IT WENT TO SEVEN THOUSAND
SO WE TALK ABOUT JYJ HEROES HI.
A CHANGE IN THE PREMIUM COST-
WHAT IT DOESN'T COVER NEAR ONE
NORMAL INSURANCE COVERS AND THEN
OTHER TIMES AND YOU KNOW RIGHT
NOW I'M LUCKY I GOT RENEWED I
GOT ACTUALLY A POLICY FROM STATE
FARM WHICH NOW I KNOW WILL NOT
BE RENEWED AT THE END OF THE
YEAR. OF MY NEIGHBORS ON THE
FAIR PLAN PAYING TWENTY FOUR
THOUSAND DOLLARS A YEAR WHILE I
MEAN YOU'RE TALKING ABOUT THE
LIFE INVESTMENTS OF PEOPLE THAT
I DON'T SEE IF WE DON'T SOLVE
THIS PROBLEM WE'RE GOING TO SEE
AN ECONOMIC CRASH LIKE WE'VE
NEVER SEEN BEFORE BECAUSE PEOPLE
ARE NOT GONNA BE ABLE TO AFFORD
THE HOMES- COMING FOR. SAN DIEGO
AREA THAT I'VE- WE SAW THE CEDAR
FIRE IN TWO THOUSAND THREE I WAS
ON THE CITY COUNCIL AT THAT
TIME. WE HAD TWENTY EIGHT
HUNDRED TWENTY STRUCTURES THE
BURN WE LOST FIFTEEN PEOPLE. IN
TWO THOUSAND SEVEN WE HAD WHICH
FIRE. WHICH IS ANOTHER HUGE
FIRE- ALMOST TWO HUNDRED
THOUSAND ACRES I THINK WAS LIKE
A HUNDRED NINETY. SEVEN THOUSAND
PLUS ACRES- WE LEARNED A LOT
SINCE THEN IN SAN DIEGO. SO WE
HAVEN'T KEEP HER FINGERS CROSSED
SEEN THAT TYPE OF CUT US OFF
FROM WILDFIRES WE'VE HAD FIRES
WITH LILAC AND OTHERS BUT- WE
LEARNED AND- THIS SAYS SDG ANNE
CREATED ITS WEATHER CENTER WHICH
IS. REALLY TOP OF THE LINE AS
FAR AS BEING ABLE TO PREDICT.
YOU KNOW. THE CHANCES OF A FIRE
WHERE IT'S GOING TO BURN IT
TAKES THE HISTORIC DATABUS TAKES
IT ALL THE OTHER CONDITIONS INTO
A FACT AND THE WINDS AND-
HUMIDITY AND- ALL OUR FIRE
CHIEFS HAVE ACCESS TO IT ON AN
APP ON THE PHONE. SO SOON AS
SOMETHING HAPPENS WHERE WE COULD
SHUT DOWN IN SAN DIEGO TEN HOMES
INSTEAD OF A HUNDRED THOUSAND
HOMES BECAUSE THEY KNOW EXACTLY
WHERE THIS PATH OF THE FIRE IS
LIKELY TO GO- AND IT HELPS WITH
EVACUATION AS WELL. BECAUSE THEN
THE. FIRE CHIEF COME LOOK AT IT
AND SAY OKAY. WITH THESE LIVE
BACK COULD ROAD AND IN AND OUT
YOU KNOW ONE WAY IN AND ONE WAY
OUT WE CAN HAVE THE WHOLE
COMMUNITY TRYING TO GET ON THE
ROAD BECAUSE THEN YOU HAVE
PEOPLE DYING AND- CAN GET OUT-
SO THEY CAN LOOK AND SEE EXACTLY
WHERE THEY NEED TO EVACUATE.
JUST THESE HOMES AND NOT ALL OF
THIS SO ALL OF THAT DATA IS
AVAILABLE AND HAS BEEN AVAILABLE
AT LEAST IN SOUTHERN CALIFORNIA
AND I THINK. NORTHERN CALIFORNIA
STILL HAS. A WAYS TO GO AS FAR
AS THAT. BUT- SO I DIDN'T. THE
BEING FRUSTRATED HAVING BEEN ON
THE FAIR PLAN AT THE TIME I
WROTE TWO PIECES OF LEGISLATION
. THAT HAD TO DO WITH ON. THAT
CLEAR WHAT WE'RE TALKING ABOUT
AND HAVING. THE INSURANCE
COMPANIES. WHO ARE USING
MODELING AND WHAT KIND OF
MODELING HAVE IT. NEAR THE
INSURANCE- COMMISSIONER LOOK AT
THOSE THINGS ALSO- TAKING INTO
ACCOUNT AND THE OTHER ONE WAS IF
YOU. I HAVE THAT THE INSURANCE
COMPANIES USING THESE MODELING'S
AND THEY'RE NOT JUST ZIP CODES.
WHERE YOU JUST BLANK. NOT RENEW
PEOPLE FROM EVERY ZIP CODE
WITHOUT LOOKING AT INDIVIDUAL
HOMES OR RISKS- THAT THAT WOULD
HELP THE INDIVIDUAL HOMEOWNERS
KEEP THEIR HOME WITH THEIR HOME
HASN'T BURNED IN FORTY YEARS.
THEN WHY IS THERE RISK AS HIGH
AS YOU KNOW THREE MILES DOWN THE
WAY THAT. THE FIRE HAS
HISTORICALLY EVERY TWENTY YEARS
OR SO BURNED THROUGH- BUT THESE
BILLS NEVER SAW THE LIGHT OF DAY
AND THE REASON IS. BECAUSE THE
INSURERS AND HAVE A LOOK AT YOUR
BECAUSE I'M- WANTING A RESPONSE.
AT THAT TIME IN TWENTY NINETEEN
AND TWENTY TWENTY SAID. WE CAN'T
DO THAT WE CAN'T BE MORE
SPECIFIC WITH THE COMMUNITIES OR
WITH INDIVIDUAL HOMES BECAUSE WE
NEED TO SPREAD THE RISK. IN
ORDER TO KEEP. SOLVE IN ORDER TO
PAY. SO WHAT WE'RE TALKING ABOUT
. HASN'T CHANGED WHAT'S THE
DIFFERENCE BETWEEN TWENTY
NINETEEN TO TWENTY TWENTY AND
NOW BECAUSE YOU KNOW UP I'M
LOOKING AT IF WE CAN USE THIS
TYPE OF DATA. I'M HOPING MORE
INSURANCE CAN ENTER THE MARKET
AND I'M ALSO HOPING THE PRICES
WILL GO DOWN OR AT LEAST BE
WITHIN REASON. GOOD QUESTION HI
SURE SURE SURE- I'M SURE THERE'S
SOME LOBBYISTS IN THE AUDIENCE
THAT WOULD JUST BE JUMPING UP
AND DOWN TO ANSWER YOUR QUESTION
THEY'RE GOING NAY AT C. PLEASE
DON'T SCREW IT UP- THEY'LL BE
BITTERLY DISAPPOINTED- SO I
WOULD SAY. IT'S IMPOSSIBLE TO
COME TO EXPECT ONE INSURANCE
COMPANY TO WRITE A COMMUNITY AND
ABOUT IDEA HONESTLY YOU DON'T
WANT THAT YOU DON'T WANT THEM TO
HAVE THAT KIND OF CONCENTRATION
OF RISK. ON THE DATA THAT YOU'RE
TALKING ABOUT. THE THEY'LL NEED
TO BE DOING INSPECTIONS EVERY
YEAR ON IT IN ORDER TO CONTINUE
TO UNDERSTAND THE VEGETATION
AROUND EACH ONE OF THOSE HOUSES.
SOME COMPANIES CHARGE A HUNDRED
FIFTY BUCKS SOMETHING LIKE THAT
TO COME OUT AND DO AN ON SITE X.
INSPECTION THAT'S NOT REALLY
SUSTAINABLE I MEAN THAT'S A LOT
OF MONEY REALLY. AND SOMEONE WHO
INSPECTS MY HOUSE DOES NOT KNOW
ANYTHING ABOUT MY NEIGHBOR'S
HOUSE THAT'S WHAT THIS THE STUFF
THE THAT A CHIEF REVOLVES
TALKING ABOUT WE'RE TRYING TO
PUT TOGETHER COLLABORATIVE DATA
COORDINATION CAMPAIGN WHICH OF
WOULD. ALLOW ONE COMPANY TO USE
DATA THAT ANOTHER COMPANY GOT
FROM AN INSPECTION FROM THE YEAR
BEFORE AND- AND MET AND MAYBE
ALLOW FIREWISE COMMUNITIES TO DO
THEIR OWN DATA COLLECTION IT
DOESN'T EVEN HAVE TO HAPPEN FROM
THE INSURANCE INDUSTRY LET CAL
FIRE STATE AGO WIN. LET
PROTECTED FUEL BREAKS- GO IN AS
ANOTHER DATA POINT FOR MODELERS
IF THEY CAN RELY ON HAVING. DATA
ACROSS THE STATE YOU'RE TALKING
ABOUT YOUR AREA WHICH IS GREAT
ANECDOTAL AND SPOTTY DATA CAN'T
BE USED OPERATIONALLY BY
MODELERS OR INSURANCE COMPANIES.
IT HAS TO BE AVAILABLE AT SCALE
HAS TO BE AUDITABLE HAS TO BE
STANDARDIZED OR ELSE THAT'S
THAT'S WHERE I COME IN LIKE HOW
DOES THE PROCESS TAKE THIS SOON.
ON AT SCALE AND HOW DO WE
MITIGATE HOW DO WE RECOGNIZE
YOUR COMMUNITY WE KNOW THAT CAL
FIRE THINK SURE IN A VERY HIGH
HAZARD AREA PERHAPS. BUT HELP
WHAT OF THOSE THREE THINGS. THAT
YOU DID TO DROP YOUR COMMUNITY
WE RISK DOWN FOR LEVEL. IF YOU
CLASS COULD BE. THAT WAY
INSURANCE COMPANIES WILL USE
THOSE CLASSIFICATIONS IN
UNDERWRITING AND RATEMAKING WHAT
THEY WILL DO WITH IT I CANNOT
PROMISE. BUT THEY WILL USE IT IF
THEY BELIEVE THAT IT REALLY
MAKES A DIFFERENCE AND
DISCRIMINATING SHEEP FROM GOATS
I WANNA MAKE MENTION ONE OTHER
HOPEFUL THING WHICH REALLY GETS
TO AFFORDABILITY FOR EXISTING
COMMUNITIES. IT'S POSSIBLE THAT
BUILDING NEW HOUSING OUTSIDE OF
A RISKY COMMUNITY COULD REDUCE
THE RISK. IN THE COMMUNITY IF
YOU EVEN LOOK YOU WANT TO DO
OTHER THINGS BUT LIKE MY WHERE I
LIVE IN ORINDA. HOME WE WE'VE
LOST A LOT OF INSURANCE
COMPANIES AS WELL. AND I THINK
IF A NEW LOOK IF NEW HOUSING
WERE BUILT ON THE OUTSKIRTS OF
THE TOWN. AND IT REDUCED. RISK
INSIDE THE TOWN. WOULDN'T OUR
TOWN FEEL A LITTLE BIT
DIFFERENTLY ABOUT BUILDING
CONDOS AND- AN AFFORDABLE
HOUSING THAT DOESN'T EXIST RIGHT
NOW THAT'S WHY. I'M NOT I'M NOT
PROMISING THAT WILL HAPPEN BUT
THAT'S AN AVENUE THAT I THINK
COULD BE EXPLORED THAT SHOULD BE
A WIN WIN FOR CALIFORNIA. WELL
GIVEN THE AND I'M JUST THINKING
YOU KNOW WE TALK ABOUT
MITIGATION AND EVERYTHING. ON MY
SIX ACRES THAT I HAVE WE CLEAR
THE WEEDS FOREIGN FIVE TIMES A
YEAR SO YOU COULD INSPECTED AND
THEN. THREE MONTHS LATER IN THE
GET THE LIGHT WINDS ALL- OR THE
RAINS ALL OF THOSE WATER THE
WEEDS NOT THE GIRLS SO. YOU KNOW
THERE'S THE WEEDS AGAIN SO RIGHT
IT'S LIKE A CHANGING. IN A
SITUATION WE HAVE TO HAVE A
PROCESS THAT TAKES THAT. INTO
CONSIDERATION AND MAKES THE MOST
WITH THE LEAST AMOUNT OF WORK IN
THE LEAST AMOUNT OF COST AND
THAT REQUIRES COLLABORATION.
YEAH I MEAN. I'LL JUST SAY THIS
ONE THING WE HAVE THIS ONE
CANYON WHERE THE WIND SOMETIMES
CAN INCREASE OF TWO HUNDRED A
HUNDRED TWENTY MILES AN HOUR.
DURING A SANTA ANA AND WITH THE
RIGHT IMMUNITY LEVELS AND
EVERYTHING THAT FIRE CHIEF THEIR
IN RING CONN CALLS THAT THE
MOUTH OF THE DRAGON AND IF WE
COULD CONTROL THAT. THAT WOULD
BE A MITIGATION. I COULD SEE
THAT WOULD HELP ME THAT AND
THAT'S WHERE THE FIRE PATHWAYS
THAT THAT PHONE CHIEF RESULT WAS
TALKING ABOUT THEY CAN REALLY
WERE WORKING ON SOMETHING WITH
THE TOWN OF PARADISE WE JUST GOT
A BREAK GRANT THIS. WEEK AND
WE'RE WORKING ON LOOKING AT FIRE
PATHWAYS INTO PARADISE AND
LOOKING AT WAYS TO DISRUPT IT'S
NOT A PEANUT BUTTER SPREAD OF
MEDICATION THIS HELPS
AFFORDABILITY TO LIKE. TARGETED
DOLLARS WE MIGHT WE MIGHT FIND
THAT RICH PEOPLE ON THE OUTSIDE
OF TOWN ARE THE ONES WHERE YOU
PUT ALL THE MONEY IN. AND THE
HOUSES MAYBE FIVE LESS WEALTHY
PEOPLE IN THE MIDDLE OF TOWN
MIGHT BENEFIT SO. THAT'S IT'S A
SORT OF A WEIRD THING WHERE YOU
HAVE TO FIGURE OUT WHERE TO THE
DOLLARS GO TO DRIVE THE RISK
DOWN FOR EVERYBODY. SORRY THIS
IS THE LAST BECAUSE WE HAD N.
EFFORT TO GET TWENTY FIVE
MILLION FOUR APPARATUS FOR THE
FIRE DISTRICTS IN HIGH FIRE RISK
AREAS. TO CLEAR BACK COUNTRY
ROADS JUST ALONG THE ROADWAYS
BECAUSE IN SAN DIEGO COUNTY. THE
DATA SHOWS THAT ABOUT 25% OF
THOSE WILDFIRES START FROM A
VEHICLE OF PULLS OVER TO THE
SIDE OF THE ROAD WOW. BUT WE
DIDN'T GET THE MONEY SO YOU KNOW
THAT WOULD BE ANOTHER EFFORT I
THINK WE CAN DO STATEWIDE. THANK
YOU SO MUCH FOR BEING HERE TODAY
WE APPRECIATE ALL YOUR COMMENTS
AND YOUR PATIENCE IN. ANSWERING
OUR QUESTIONS- NOW WE'RE GONNA
OPEN UP THE MICROPHONE TO PUBLIC
COMMENT. THANK YOU- PLEASE COME
FORWARD STATE YOUR NAME AND
AFFILIATION AND PLEASE LIMIT
YOUR TESTIMONY TO TWO MINUTES
EACH. YEAH. GREETINGS AT DAN
DONE WAY WITH THE CITY'S. I DO
DONE WAY WITH A CALL BUILDING.
ASSOCIATION A CHAIRS THANK YOU
FOR HOLDING THIS REALLY
IMPORTANT HEARING. IS A COUPLE
THINGS TO BUILD ON FROM ALL THE
COMMENTS WE DO SUPPORT. THAT
COULD HOUSE REMODELING. IF WE
ARE THE- ONLY BUILDING INDUSTRY
ASSOCIATION AMERICA THAT HAS
SUPPORTED THE MOST STRICT FIRE
HARDENING STANDARDS OF ANY
BUILDING INDUSTRY IN THE UNITED
STATES. SINCE TWENTY TEN HERE'S
A POSITIVE NOTE ON TODAY'S
HEARING. SINCE TWENTY TEN SINCE
WE'VE BEEN USING THE NEWS CODES.
NOT A SINGLE ONE OF OUR MASTER
PLANNED COMMUNITIES WITH REGULAR
MITIGATION HAVE BURNT. SO WE
LOOK AT ALL THE HORRIBLE FIRES
WE SEEN WE HAVE CREATED A FIRE
SCIENCE FOR BUILDING IN
CALIFORNIA THAT STOPS WILDFIRES
FROM THE STRAINER COMMUNITIES I
WAS STUNNED BY NANCY WATKINS
COMMENTS WE DO BELIEVE IN TWO
MAJOR CHIEF FIRE JESUS SAID IF
WE WERE TO BUILD RINGS OF NEW
HOMES AROUND OLD HOMES. WE COULD
SOLVE THIS CRISIS AND SOLVE THE
HOUSING CRISIS TWO OTHER KEY
POINTS- WE DO SUPPORT
CATASTROPHE MODELING
PARTICULARLY IF IT INCLUDES
RECOGNIZING MITIGATION. SO WHEN
THE BIGGEST ARGUMENTS THE
INSURANCE INDUSTRY IS SAYING NO
YOU CLEAR THE FIELD TODAY THAT
ASSEMBLY MEMBER MENTIONED BUT
YOU KNOW A YEAR LATER THEIR SIDE
BRUSH. WE BELIEVE NOW THAT WE
HAVE MASTER PLANNED COMMUNITIES
WITH HOMEOWNERS ASSOCIATIONS WE
BUILD AND REGULAR MAINTENANCE OF
FIRE HARDENING THAT NEEDS TO BE
TAKEN ACCOUNT THE MODELING IT'S
NOT QUITE THERE YET SAKET WE
HAVE GOOGLE MAPS OF OTHER
SOPHISTICATED TOOLS THAT
MITIGATION HAS BEEN RECOGNIZED.
AS WAS RECOGNIZED EARLY IF YOU
HAVE A COMMUNITY DOESN'T BURN
BECAUSE OF MITIGATION THAT NEEDS
TO BE TAKEN TO ACCOUNT IN THE
MODELING. LASSEN WILL SAY IS WE
ARE SITTING ON A HOUSING CRISIS
TODAY AND IT AND IT'S GETTING
WORSE IN THIS FIRE SITUATION FOR
ONE KEY REASON. FOR THE
COMMISSIONERS ON SOME REALLY
GOOD WORK EXPAND THE FAIR PLAN
THE TWENTY MILLION PER LOCATION
BUT MOST CONDO ASSOCIATIONS ARE
BIGGER THAN THAT. LAST NIGHT I
WAS TOLD IN SAN DIEGO COUNTY AT
A PROJECT TO BUILD ELEVEN
HUNDRED CONDOMINIUMS IS NOW PUT
ON HOLD. BECAUSE THERE'S NO
ADEQUATE COMMERCIAL COVERAGE IN
THE FAIR PLAN OR ANYWHERE. LAST
THING I WOULD SAY IS THAT IS 30%
RATE INCREASES IT SUBMITS A BAD
NUMBER. OUR RECORD THIS YEAR ONE
OF OUR MEMBERS. I WANT TO PLACE
INSURANCE AFTER THEIR
ASSOCIATION WAS NON RENEWED. THE
DIFFERENCE BETWEEN A MINUTE
CARRIER. AND THE NOT ADMITTED
KERRY WAS 60009100% NOT 38% BUT
SIX THOUSAND A 100% FROM FORTY
THOUSAND. TO TWO POINT EIGHT
MILLION FOR THE- MONTHLY
ASSOCIATION DUES ONE FROM. TWO
HUNDRED FIFTY TO FIFTEEN
HUNDRED. SO AS BAD AS THIRTY
RATING. ITS PER. WE BELIEVE THE
OUR ROLE MAR OR- IN A SOLUTION
TO THIS PROBLEM. AND WE'RE
COMMITTED TO WORK WITH THE
CHAIRS AND THE MEMBERS TO DO
THIS BLESSING I'D SAY IS WE NEED
TO ACT QUICKLY. THIS IS REAL
THIS IS AFFECTING HOMEOWNERS
TODAY AS WE SIT HERE AND WE'D
LIKE TO BE PART OF THE SOLUTION
THANK YOU. THANK YOU I AM SURE
MEMBERS JOHN HARWOOD ON BEHALF
OF THE INDEPENDENT CHARTS AGENTS
AND BROKERS. ASSOCIATION
CALIFORNIA I'LL BE VERY VERY
QUICK- OUR MEMBERS SALAS AS WE
SAID BEFORE THIS IS THE WORST
MARKET THEY'VE EVER SEEN THEIR
CAREERS- WE GET REGULAR REPORTS
FROM- OUR MEMBERS THAT HAVE A
CLIENT. THEY CAN'T EXPAND THEIR
BUSINESS BECAUSE THEY CAN'T GET
INSURANCE THEY'RE FACING
FORECLOSURE ON THEIR HOME
BECAUSE THEY OR- HI FORCED PLACE
POLICY BECAUSE THEY- CAN'T GET
INSURANCE. THAT ARE WORRIED
ABOUT LOSING THEIR CONDOMINIUM
BECAUSE THEY CAN'T AFFORD THE
HOMEOWNER'S DUES INCREASE TO PAY
FOR THE INSURANCE. WE STARTED
THIS CONVERSATION ON RATE
FILINGS AND REINSURANCE AND
THINGS OVER TWO YEARS AGO. AND
IT'S YOU KNOW IT TOWARDS A TIME
SCALES PACE I AGREE WITH MR DONE
MORE SOMETHING'S GOTTA BE DONE
YESTERDAY ON THIS. I DID TESTIFY
ONE OF THE LAST OVERSIGHT
HEARINGS YOU HADN'T INDICATED
THAT EVERYTHING WE'VE SEEN AND
THE WORK THAT WE'VE DONE. THAT
WE'VE HIRED OUT IS MOST
COMPANIES ARE LOOKING FOR A
TWENTY TO. 40% RATE INCREASE TO
GET ADVOCACY AND MUSCLES WON'T
APPLY THAT OVERNIGHT BUT THAT'S
WHAT THEY NEED. TO GET TO RATE
ADEQUACY SO IF YOU TAKE A
AVERAGE 30% INCREASE ON A
TYPICAL HOMEOWNER'S POLICY OF A-
THOUSAND TO FIFTEEN HUNDRED
DOLLARS YES IT'S THREE HUNDRED
DOLLARS OR FOUR. DOLLARS BUDGETS
COUPLE DINNERS OUT OR SOMETHING
IT'S MANAGEABLE HIS WIFE TRYING
TO SAY FOR H. IS PAYING FIFTY
OR- EIGHTY THOUSAND DOLLARS A
YEAR FOR HOMEOWNERS INSURANCE
30% INCREASES MANAGEABLE. NO
1000% OF 15% OF 5100% ISN'T
MANAGEABLE SO. AGAIN I AGREE
WITH MR DONE MORE THE WE TO MOVE
QUICK AND I PER- NEW THE CHAIR
AND SPOKE CHAIR THE COMMITTEE
STAFF FOR THE WORK THEY'VE DONE
AND PUTTING THE FROM THE GO
HEARING. THANK YOU VERY MUCH.
YES YES THANK YOU- GOOD MORNING-
AFTERNOON ON AT THIS POINT-
SEREN TAYLOR ON BEHALF OF THE
PERSONAL INSURANCE FEDERATION
CALIFORNIA- ONE THANK YOU AND
ALL THE PANELISTS ARE FOR THE
THOUGHTFUL DISCUSSION TODAY- WE
DID SUBMIT DETAILED COMMENT
LETTER. THAT EXAMINES THE MANY
CHALLENGES FACING CALIFORNIA'S
INSURANCE INDUSTRY WHICH IS
NOTED IN THE EXCELLENT COMMITTEE
BACKGROUNDER EXTEND BEYOND THE
ONE FACTOR. EXAMINED TODAY AND
TO ASSEMBLY MEMBER SHOPPERS
POINT- IT'S NOT A PANACEA BUT IT
IS A VERY IMPORTANT COMPONENT OF
AN OVERALL COMPREHENSIVE PLAN TO
GET A MORE RESILIENT INSURANCE
MARKET BACK IN CALIFORNIA- I
THINK MISS WALKEN'S TESTIMONY
PROVIDED A GREAT OVERVIEW OF THE
NEED FOR FORWARD LOOKING.
CATASTROPHE MODELS INSTEAD OF
THE CURRENT BACKWARDS LOOKING
APPROACH THAT FAILS TO RECOGNIZE
THE IMPACT THAT CLIMATE CHANGE
POSES THE CALIFORNIA PROPERTIES
AND ACTUALLY DISCOURAGES
INSURERS FROM INCREASING
AVAILABILITY OF COVERAGE IN
WILDFIRE AREAS. AND YOU KNOW THE
IT IN OUT THE SIMPLE FACT IS OF
CALIFORNIA- WON'T PERMIT
INSURERS TO DEVELOP RATES USING
SCIENTIFIC UNDERSTANDING THEN
IT'S LIKELY INSURERS WILL
CONTINUE TO LIMIT INCH ISSUANCE
OF POLICIES. IN HIGH RISK AREAS
AND WE DON'T WANT THAT TO HAPPEN
RIGHT THESE COMPANIES HAVE SPENT
DECADES BUILDING BRAND THEY'RE
THEY'RE THEY'RE AGENTS OF MR
NORWOOD TALKED ABOUT HAVE THEIR
CLIENTS THEY CARE ABOUT THIS.
THEY'RE NOT IN THE BUSINESS TO
NON RENEW PEOPLE THEY DON'T WANT
TO BE MAKING THESE DECISIONS WE
HAVE A SYSTEM THAT IS LEADING TO
A PREDICTABLE OUTCOME. AND THERE
ARE OTHER. REGULATORY PROCESS
ISSUES THAT WE LOOK FORWARD TO
WORKING ON WITH OUR COLLEAGUES
AT THE DEPARTMENT OF INSURANCE
AND OF COURSE WITH THE
LEGISLATURE AND THE GOVERNOR'S
MOVE FORWARD- I DO THINK THIS
HEARING IS CLEARLY DEMONSTRATED
THAT CATASTROPHE MODELS. ARE
EXTREMELY VALUABLE TOOL FOR BOTH
INSURERS AND POLICYHOLDERS. AND
THESE MODELS YOU KNOW THEY
PROVIDE POLICY HOLDERS ALSO
INSIGHTS INTO RISK MITIGATION-
BY UNDERSTANDING THE
VULNERABILITIES ASSOCIATED WITH
THEIR PROPERTY OR LOCATION. THEY
CAN TAKE PROACTIVE MEASURES TO
REDUCE THEIR EXPOSURE AND THAT'S
CONSISTENT WITH THE NEW CD I
MEDICATION WILDFIRE RISK-
REGULATIONS. SO YOU KNOW I KNOW
THERE'S MORE WORK TO BE DONE- WE
REALLY LOOK FORWARD TO WORKING
WITH ALL OF YOU ON THAT. AND
APPRECIATE THE OPPORTUNITY TO
PROVIDE THESE COMMENTS- BUT WE
REALLY WORK NEED TO WORK ON A
COMPREHENSIVE SOLUTION THAT
PROTECTS. CHOICE AND
AVAILABILITY FOR ALL
CALIFORNIANS. THANK YOU. MARK
SECOND WITH THE AMERICAN
PROPERTY CASUALLY INSURANCE
ASSOCIATION ACROSS THE STAFF OF
JETTISON MY TWENTY MINUTES THE
PUBLIC COMMENTS. AS WELL AS A
THANK YOU FOR THE HERE AND I
THINK WE LEARNED A LOT ABOUT THE
ROLE THAT CATASTROPHE MODELS
COMPLY. ARCHITECTURE MALLS HAVE
COME A LONG WAY SINCE THE
NINETEEN EIGHTIES WHEN EVERYBODY
TALK ABOUT THESE- BLACK BOXES
THAT NOBODY KNEW ANYTHING ABOUT.
IN ADDITION TO ALL THE
VERIFICATION TOOLS THAT WERE
MENTIONED EARLIER- OF THE
NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONERS IS
WORKING ON A CENTER OF
EXCELLENCE TO HELP REVIEW THESE
MODELS BETOOTA FOR SMALL STATES
THAT DON'T LACK. DON'T HAVE THE
STAFF THE CALIFORNIA CHOICE OF I
THINK WE HAVE I THINK THE
MESSAGE VERY CLEAR HAS BEEN THAT
HAS BEEN SET ANOTHER HEARING
AIDS. WE CAN'T INSURE OURSELVES
OUT OF THIS MESS WE HAVE TO
MEDICAID THE ONLY WAY YOU IT THE
DECREASE RATES IS BY DECREASING
RISK- I WANT TO SAY THAT. YOU
APPRECIATE WHAT THE DEPARTMENT
VENTURES HAS BEEN DOING I'VE
BEEN DOING A LOT OF WORK WITH
THE DEPARTMENT CHARTS TRY
FACILITATE CONVERSATIONS TO TRY
BEING A CHURCH BACK TO. THE BACK
TO CALIFORNIA A ONE RIGHT
CALIFORNIA THEY'RE WATCHING VERY
CLOSELY- AND THEY'RE HOPING THAT
WE'RE ABLE. TO ACCOMPLISH
SOMETHING HERE THANK YOU. OKAY
LIFTED. THANK YOU ALL FOR PART.
TO THE- THIS IS ADJOURNED.