AB 567 California Assembly · 2025-2026 Regular Session

Insurance: residential and commercial.

Summary

Existing law establishes the Department of Insurance, headed by the Insurance Commissioner, which regulates insurers and insurance practices. Existing law divides insurance into classes, including, among others, life insurance, fire insurance, and marine insurance. Under existing law, an insurer is entitled to payment of the premium as soon as the subject matter insured is exposed to the peril insured against. This bill would require, upon an appropriation, the state to pay for any annual increase in residential property insurance rates that is above either an annual increase of 7% or the annual national average increase in residential insurance premiums, whichever is lower. The bill would require, by March 31, 2026, the Department of Insurance, in consultation with insurers in the insurance industry, to provide a report to the Legislature on, among other things, how to slash regulations on the insurance market to achieve efficiencies to keep residential property insurance rates at or below the annual national average increase in residential insurance premiums. The bill would repeal these provisions on January 1, 2030. Existing law imposes a gross premiums tax of 2.35% on all insurers doing business in this state, as set forth in the California Constitution. This bill would, until January 1, 2030, set the gross premiums tax rate for premiums received for residential property insurance policies at 0% for premiums received on or after January 1, 2026.

Bill status failed 1 of 4 stages cleared

Introduction

Feb 2025

Committee Review

Floor Vote

Governor

Introduced Feb 12, 2025 Last action Feb 2, 2026

Maddy AI version diff · 2 comparisons

What changed between versions

03/10/25 - Amended Assembly → AB567 · 1 edit

MINOR

No substantive policy changes were made between these two versions of AB 567. The differences are entirely in document formatting and presentation: the old version uses a traditional legislative document layout with line numbers and page headers, while the new version is a web page rendering that includes navigation elements (menus, search boxes, bill information panels). The actual bill text, sections, and provisions are identical.

TECHNICAL

The document was reformatted from a traditional legislative print layout (with line numbers, page headers/footers, and formal indentation) to a web page rendering that includes site navigation elements such as skip-to-content links, search boxes, bill information panels, and share buttons. No policy language was changed.

02/12/25 - Introduced → 03/10/25 - Amended Assembly · 7 edits · Mar 10, 2025

MODERATE

AB 567 was dramatically expanded from a one-line legislative intent statement into a multi-section bill called the 'Cap and Cut Cost of Insurance through Reform Act.' The amended version adds a state-funded cap on residential property insurance rate increases (above 7% or the national average, whichever is lower), eliminates the gross premiums tax on residential property insurance starting January 2026, requires a report on slashing regulations and allocating $1 billion per year for fire fuel reduction, and urges federal reinsurance dialogue. All new provisions sunset on January 1, 2030.

Scope change

Expanded from a symbolic one-line intent statement to a substantive multi-section bill with direct financial impacts (state payments for rate increases above a cap, elimination of a tax on residential property insurance), regulatory reform mandates, and federal policy recommendations, all with a 2030 sunset.

FISCAL

State would pay (upon appropriation) any annual increase in residential property insurance rates above either 7% or the national average increase, whichever is lower, until January 1, 2030.

Gross premiums tax rate set to 0% for residential property insurance policies for premiums received on or after January 1, 2026, sunsetting January 1, 2030.

REQUIREMENT

Department of Insurance must report to the Legislature by March 31, 2026 on how to slash regulations, allocate $1 billion per year for four years on fire fuel reduction, and suspend or reform environmental regulations (CEQA, Air Resources Board, Coastal Commission) that limit defensible space clearing or increase brush management costs.

SCOPE

Legislature urges the Governor to initiate dialogue with the federal government on a national reinsurance relief program involving regulatory reform and a federal 'reinsurance bridge financing' program.

The original one-section legislative intent statement was moved to the end of the bill and made operative only on January 1, 2030, after all other provisions expire.

TIMELINE

All new provisions sunset on January 1, 2030. A replacement version of Section 12221 (without the 0% tax) becomes operative that same date to restore normal tax treatment.

TECHNICAL

Fiscal committee designation changed from 'no' to 'yes,' indicating a fiscal note is now required due to the new state funding obligations.

Floor votes

How they voted

No floor votes recorded yet.

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Feb 2, 2026

Lower · Passed

From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.

lower

Apr 28, 2025

Lower · Passed

In committee: Set, second hearing. Held under submission.

lower

Apr 21, 2025

Committee

In committee: Set, first hearing. Referred to suspense file.

lower

Mar 28, 2025

Committee

Re-referred to Coms. on REV. & TAX. and INS. pursuant to Assembly Rule 96.

lower

Mar 11, 2025

Committee

Re-referred to Com. on INS.

lower

Mar 10, 2025

Introduced

From committee chair, with author's amendments: Amend, and re-refer to Com. on INS. Read second time and amended.

lower

Mar 10, 2025

Committee

Referred to Coms. on INS. and REV. & TAX.

lower

Feb 13, 2025

Lower · Passed

From printer. May be heard in committee March 15.

lower

1 primary · 0 co-sponsors