California approves a voluntary public pre-review of insurance rate requests

The California Department of Insurance said on 19 October that the Office of Administrative Law has approved its Comprehensiveness Review Regulation. The rule sets up a voluntary process in which Department staff analyse a proposed personal or commercial lines rate before the insurer submits a formal application under Proposition 103. The Department presents it as part of Commissioner Lara's Sustainable Insurance Strategy.

The main change is disclosure. The Department will make its initial rate range indications public and says it will be able to "publicly release predicted rate savings" from its review. It says its annual review of hundreds of property, commercial and auto filings has saved consumers $6.6bn since 2019. Insurers that do not want the pre-review can go straight to a formal rate filing, which stays under the current process.

The intervenor process, under which third parties that represent consumers can be compensated, continues. The regulation puts into law the intent of Bulletin 2024-7, an emergency measure issued in August 2024. It works alongside the Complete Rate Application Regulation, in force since 2024, which targets delays caused by incomplete filings.

To show how the review works, the release uses a homeowner who pays about $1,500 a year, the statewide average, and an insurer that explores a 5% rate increase. "Every dollar Californians pay for insurance should be justified," Lara said.