wa-law.org > bill > 2025-26 > SB 5928 > Engrossed Substitute
An insurer that uses a wildfire risk score relating to property insurance and in connection with either the underwriting of real property regarding eligibility for coverage, or in rating of real property to generate a premium, or both, shall provide the insured, upon nonrenewal or cancellation due to wildfire risk or when the insured premiums are adversely impacted by the wildfire risk score, and if applicable the relevant insurance producer, the following information to enhance transparency:
The current wildfire risk score of the property to be covered;
The range of possible wildfire risk scores under the model used;
The name of the entity that created the wildfire risk score for the property;
The date on which the wildfire risk score was created for the property; and
The key factors that adversely contributed to the wildfire risk score of the property and, for factors within the control of the consumer, the steps that the consumer can take to improve it. For factors outside the control of the consumer, a list of the factors may be provided without the steps to improve.
When the insured premiums are adversely impacted by the wildfire risk score, an insurer shall provide to an insured in writing and in plain language the information listed in subsection (1) of this section in the renewal notice to the insured.
An insurer shall provide the insured in writing and in plain language the information listed in subsection (1) of this section within the nonrenewal or cancellation notice.
For a policy nonrenewal, the information may be provided in the notice required in RCW 48.18.2901.
For a policy cancellation, the information may be provided in the notice required in RCW 48.18.290.
An insurer shall provide a revised wildfire risk score or wildfire risk classification, once per policy period, no later than 20 business days after receipt of the policyholder's request with documentation that since the last evaluation the policyholder:
Has completed a property-specific mitigation action to reduce the risk of loss as identified by the insurer in section 2(3) of this act; or
Provides evidence of a community-level mitigation action in sufficient proximity to the property to reduce the risk of loss as identified by the insurer in section 2(3) of this act.
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A policyholder of residential personal lines property insurance whose wildfire risk model score, wildfire risk classification assigned to the property, or applicable mitigation discount is inaccurate, and provides evidence of the property-specific or community-level mitigation action may appeal the score directly to the insurer once per policy period. The insurer shall notify the policyholder in writing of the right to appeal the wildfire risk score or other wildfire risk classification or applicable mitigation discount when the score, classification, or discount is provided to the policyholder as required by subsections (2) and (3) of this section.
If the policyholder appeals the wildfire risk score or other wildfire risk classification or applicable wildfire discount, the insurer shall acknowledge receipt of the appeal in writing within 10 business days after receipt of the appeal. The insurer shall respond to the appeal in writing with a reconsideration and decision within 20 business days after receiving the appeal. If an appeal is denied, the insurer shall, upon request by the commissioner, forward a copy of the appeal and the insurer's response, to the commissioner.
For purposes of this section:
"Adversely impacted" means charging a higher insurance premium for insurance than would have been offered if the wildfire risk score had been more favorable, whether the charge is by:
Application of a rating rule; or
Assignment to a rating tier that does not have the lowest available rates;
"Insurer" means authorized insurers in this state; and
"Wildfire risk score" means a numerical value, rating, or categorization derived from a statistical tool, modeling system, algorithm, or other process that is used for the purpose of predicting the future wildfire related insurance loss exposure of a property to measure or assess wildfire risk for residential personal lines property for the purposes of property evaluation in either underwriting, or rating, or both.
The commissioner may adopt rules as necessary to implement this section.
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An insurer providing residential personal lines property insurance coverage that uses any wildfire risk model or a catastrophe model or scoring method to assign risk shall provide the wildfire risk model, catastrophe model, or scoring method used to assign risk, including a description of the model, the impact of the model on rates, and an actuarial justification for all rating factors, including mitigation discounts offered, and an explanation of the use of the model in underwriting decisions, to the commissioner as part of the insurer's complete rate filing. Such explanation is limited to wildfire risk only and an insurer is not required to submit underwriting guidelines or manuals as part of the explanation.
To the extent data is available and as established by rule, an insurer shall submit to the commissioner, as part of their rate filings, information on how and whether the models used for either underwriting, or rating, or both, account for statewide and local mitigation activities, such as forest treatment, investments in wildfire fighting and mitigation equipment, and utility wildfire mitigation activities.
Wildfire risk models must not be used to calculate premiums or rate differentials, or eligibility for coverage unless the scoring models are filed with the commissioner. Wildfire risk models include all attributes and factors used in the calculation of a wildfire risk score. RCW 48.19.040(5) does not apply to any information filed under this subsection, and the information must be withheld from public inspection and kept confidential by the commissioner. All information filed under this subsection is considered trade secrets under RCW 48.02.120(3). Information filed under this subsection may be made public by the commissioner for the sole purpose of enforcement actions taken by the commissioner.
An insurer providing residential personal lines property insurance coverage that uses a wildfire risk model, a catastrophe model, or a combination of models shall ensure the following factors are either incorporated in the wildfire risk model, catastrophe model, or combination of models or are otherwise demonstrably included in the insurer's underwriting and pricing when actuarially supported:
Property-specific mitigation actions, such as establishing defensible space, incorporating building hardening measures, or receiving certification from an entity with expertise in mitigation of properties against wildfire; and
Community-level mitigation activities or designations, including forest treatment, other fuel reduction activities, and local fire protection efforts.
An insurer providing residential personal lines property insurance coverage shall post on its public website readily accessible information on the premium discounts, incentives, or other premium adjustments that may be available to policyholders who undertake property-specific mitigation actions or provide evidence of community-level mitigation actions and the process for appealing a wildfire risk score. The website must identify, as applicable:
Property-specific mitigation actions for the policyholder to undertake and community-level mitigation actions that could result in a discount, incentive, or other premium adjustment; and
The potential amount of the discount, incentive, or other premium adjustment that may be available.
For the purposes of this section:
"Catastrophe model" means a tool, instrumentality, means, or product, including a map-based tool, a computer-based tool, or a simulation that is used by an insurer to estimate potential losses from catastrophic events;
"Community-level mitigation action" means a science-based mitigation action as demonstrated by a community-level or neighborhood-level designation or certification or as undertaken by a government entity;
"Property-specific mitigation action" means a science-based mitigation action as demonstrated by the "wildfire prepared home" designation from the insurance institute for business and home safety or by a similar mitigation program that includes a verification and certification process; and
"Wildfire risk model" means a tool, instrumentality, means, or product, including a map-based tool, a computer-based tool, or a simulation, that is used by an insurer in whole or in part, to measure or assess the wildfire risk associated with a residential personal lines property or community for purposes of rating, classifying, or pricing based on wildfire risk or estimating risks or losses corresponding to the wildfire risk classifications.
The commissioner may adopt rules as necessary to implement this section.