Lawmakers to vote on scaled-back wildfire bill

California lawmakers are set to vote Tuesday during a special session on a scaled-back wildfire liability package, after Gov. Gavin Newsom's push to shield utilities from some costs associated with fires sparked by their equipment failed to gain enough support. The measure, Senate Bill 492, focuses largely on speeding up payments to wildfire survivors and limiting certain practices surrounding wildfire claims, while leaving in place insurers' ability to pursue utilities for losses tied to fires.

The bill is expected to come before lawmakers for a final vote Tuesday morning, after the Legislature's scheduled end-of-session deadline Monday. Because SB 492 includes an urgency clause, lawmakers can vote on it after the regular session concludes.

The developments mark a significant change from the proposal Newsom was pushing last week. His administration sought to reduce utilities' exposure to wildfire claims, including by limiting or ending insurers' ability to sue utilities to recover money they paid to policyholders after fires. The governor argued the changes were necessary to protect the state's utilities from potentially crippling liabilities and help stabilize electricity rates.

But the proposal faced fierce opposition from wildfire survivors, consumer advocates, insurers, and lawmakers who argued it could shift more costs onto people who lost their homes and businesses. Fire survivors heavily criticized the proposal, even protesting outside the governor's mansion in Sacramento last week. They argued Newsom's plan would have placed the needs of utilities over victims, while insurance companies said shifting more of the cost of damage onto them would have required them to raise rates for policyholders.

What the bill does

The provision limiting insurers' ability to sue is not included in the latest version of SB 492. The bill instead preserves survivors' ability to pursue lawsuits and does not impose the proposed cap on damages that had been part of Newsom's broader plan.

One of the biggest changes would be the creation of a "Fast Pay" program intended to get money to wildfire survivors more quickly. The measure also would restrict the ability to sell or transfer wildfire claims to third parties, including private-equity firms.

It also addresses utility executive compensation, prohibiting certain bonuses for utility CEOs and senior executives when their company is responsible for a wildfire that damages at least 500 structures.

The California Catastrophe Response Council would appoint an administrator to resolve survivor claims more quickly, according to a report from SFGATE.

The American Property Casualty Insurance Association praised the deal, according to SFGATE. PG&E and some lawmakers criticized the bill, the report added.

Reactions

Newsom acknowledged the compromise on Saturday, calling it progress but not far-reaching enough. "I could have easily walked away from it," he told reporters at the Capitol on Monday, according to SFGATE. "And that would have been a disservice to you and the people of this state."

Insurance Commissioner Ricardo Lara said SB 492 advances efforts to improve wildfire preparedness, accountability, community resilience, and support for survivors.

Joy Chen, executive director of Every Fire Survivor's Network, a group of survivors of the 2025 Los Angeles-area fires, said the deal was a win for them. "Survivors from across California came..." (quote continues in source material).

Newsom's failure to get his full plan passed marked a rare loss for the governor, who has often found support for his policy wishes in the Democratic-led Legislature. It comes as he wraps his final session before leaving office in January.