As climate change destroys homes, infrastructure, and sometimes whole settlements, the insurance industry will be on the hook. To address the subject, UC Berkeley Law’s Center for Law, Energy and the Environment (CLEE) partnered with the California Department of Insurance (CDI) and Dr. Evan Mills to release Trial by Fire: Managing Climate Risks Facing Insurers in the Golden State.

Trial by Fire offers a comprehensive review of the nature and extent of the risks and opportunities faced by insurers and residents in California.

My colleague and CLEE co-author Ted Lamm has an op-ed in today’s San Francisco Chronicle along with California Insurance Commissioner Dave Jones and Dr. Mills to summarize the report’s key findings. The basic policy recommendations include:

Enact more legislation like state Senate bills 894 and 824, both recently signed by the governor, which protect consumers by requiring insurers to offer policy renewals after a declared disaster and enhanced insurer data reporting regarding fire-related issues;

Enact legislation to require insurers’ fire risk models to be evaluated by the Department of Insurance to ensure that they account for the evolving harms of climate change and home- and community-level protective measures to reduce fire risks;

Conduct pilot projects to test the viability of making insurance available for higher-risk homes if the homeowner and community meet strict risk-mitigation standards;

Increase the availability and sale of insurance products that incentivize better fire-defense measures at homes and businesses and emission-reduction efforts; and

Disclose to the public insurers’ fossil fuel holdings, divest from thermal coal holdings, and actively invest in renewable energy and climate-change-mitigating projects.

Climate impacts will only worsen in the coming years. But with these steps, policy makers can help the insurance industry — and the general public — avoid the worst while ideally becoming part of the solution.