Legislative Insights || Assemblyman Tom Lackey on California's Insurance Reforms

Published Date: 07/23/2024

Legislative Insights: Assemblyman Tom Lackey on California’s Insurance Reforms and Road Safety Challenges

California’s insurance system is at a crossroads. Homeowners across the state are grappling with soaring premiums, disappearing coverage options, and a marketplace teetering on the edge of dysfunction. Meanwhile, the state’s roadways are seeing a surge in distracted driving accidents and rising safety concerns.

In this special Insurance Hour episode, host Karl Susman sat down in Sacramento with Assemblyman Tom Lackey — a former California Highway Patrol officer and a ten-year veteran of the State Legislature — to discuss two pressing issues shaping the lives of Californians: the state’s insurance crisis and the growing danger of distracted driving.

What followed was an unusually candid conversation about affordability, accountability, and the challenges of legislating in a state where every solution seems to come with new complexities.

From the Highway to the Capitol: Tom Lackey’s Road to Public Service

Assemblyman Tom Lackey’s story begins in the small desert town of Boron, California — a close-knit mining community of roughly 3,000 residents. His father was the local dentist, and Lackey’s early ambition was to serve and protect his community.

After earning a degree in special education, he spent a year teaching before pursuing a lifelong dream: joining the California Highway Patrol (CHP).

“I overcame the odds after teaching a year in special education,” Lackey recalled. “And I retired from the highway patrol after 28 years.”

That hands-on experience gave him an unfiltered view of Californians’ day-to-day challenges — from traffic safety to financial hardship. Today, as a legislator representing parts of Southern California, Lackey channels that same sense of duty into policymaking.

“It’s a very rewarding battle at times,” he said, “and very frustrating at other times.”

One of those frustrating battles? Insurance.

The Distracted Driving Dilemma

Before diving into property insurance reform, Susman couldn’t resist asking Lackey — the former highway patrolman — about something he’s seen firsthand: distracted driving.

“We all create habits,” Lackey said. “And these smartphones have become a big part of our lives. A significant majority of people do not abandon those habits when they get behind the wheel.”

He’s right. According to studies by the National Highway Traffic Safety Administration (NHTSA), distracted driving contributes to nearly one in ten fatal crashes in the United States. But Lackey’s concern goes beyond statistics — it’s about behavioral conditioning.

“When you drive, look around,” he said. “You’ll see a high percentage of drivers paying more attention to their devices than the road. That’s extremely dangerous.”

Susman added context from an insurance perspective:

“The time it takes your eyes to refocus when you look down at your phone — even for a second — means you can travel the length of a football field without seeing the road ahead.”

Lackey nodded knowingly.

“Good driving requires attention,” he said. “These devices are impairing that attention — and it’s getting worse.”

Are Touchscreens Making Cars More Dangerous?

Susman then raised a fascinating question: with car manufacturers moving toward touchscreen-based controls, is modern technology making driving more dangerous?

Some automakers, recognizing the safety risks of “menu-based” systems, are now talking about returning to physical knobs and dials — which allow drivers to adjust settings without taking their eyes off the road.

“If legislation came your way to support that, what would you think?” Susman asked.

Lackey didn’t hesitate:

“Anything that enhances safety, I support. But I have to make sure I’m not being sold a bill of goods.”

After decades observing drivers up close, he knows how even well-intentioned policies can backfire.

“Anything that makes driving safer, I’ll support,” he said. “Because we’re in a dangerous set of circumstances. We not only have impairing devices, but we have substances entering into the public debate — and somehow it’s become political. I don’t understand how safety became political.”

It was a striking observation — and a fitting segue into the second half of their conversation: how to make insurance reform less political and more practical.

The Elephant in the Room: California’s Property Insurance Crisis

After the lighthearted talk about driving, Susman turned to what he called “the elephant in the room” — property insurance.

Insurers are leaving the state or drastically limiting coverage. Premiums have skyrocketed. And homeowners, even those without claims, are being non-renewed.

“Tell me what you’re hearing from your constituents,” Susman asked.

Lackey’s answer was blunt:

“Inaffordability. That’s what I’m hearing — people can’t manage the cost. And I don’t have good, comforting news to share.”

It’s a sentiment echoed by millions of Californians. After years of catastrophic wildfires, rising construction costs, and inflation, the state’s insurance system is struggling to keep pace.

“We have agencies who make a profession out of this thing finding it very, very difficult to stay in business here,” Lackey said.

A Complicated Problem with No Simple Solution

Both men agreed that California’s insurance crisis is the result of overlapping issues: strict regulations, environmental risk, and an outdated approval process under Proposition 103, which requires insurers to get state permission before raising rates.

“It’s not a simple problem,” Susman said. “And it’s not going to have a simple solution.”

Lackey nodded.

“Exactly. It’s a complex challenge, and it’s affecting everyone — homeowners, renters, business owners. There’s no easy fix.”

The Sustainable Insurance Strategy

So what’s being done to fix it?

Susman brought up the Sustainable Insurance Strategy, a plan introduced by California Insurance Commissioner Ricardo Lara in 2023. The initiative aims to modernize how insurance rates are calculated, streamline approvals, and bring more insurers back to the state.

“We’re hearing about this ‘Sustainable Insurance Strategy,’” Susman said. “What do you think about it — and the Governor’s trailer bill that’s supposed to fast-track parts of it?”

The “trailer bill”, backed by Governor Gavin Newsom, would allow parts of Lara’s plan to be implemented more quickly through budget legislation, rather than waiting for full legislative review.

Lackey acknowledged that speed is essential — but cautioned that reforms must still be transparent.

“People are frustrated,” he said. “They want to see progress, but they also want accountability. We can’t rush something this important without making sure it’s fair and effective.”

What’s at Stake

Without reform, the situation could worsen. California’s FAIR Plan — originally designed as a last-resort insurer for high-risk properties — is ballooning, with enrollment nearly doubling since 2019. Private insurers, meanwhile, say they can’t operate profitably under current restrictions.

“You can’t expect a company to pay out billions in wildfire losses if they can’t adjust rates or use modern risk models,” Susman said. “They’ll just stop writing policies — and that’s exactly what we’re seeing.”

Lackey agreed that the state needs a balanced approach — one that protects consumers and keeps insurers financially viable.

“It’s not about letting corporations off the hook,” he said. “It’s about ensuring Californians can actually get insurance in the first place.”

The Misinformation Problem

Another challenge, Lackey noted, is public misunderstanding. Many Californians don’t realize how regulated the insurance industry actually is — or how limited the state’s power can be when insurers pull out voluntarily.

“What’s real is the level of misinformation,” he said. “People think the government can just tell insurers to lower prices or stay in the market. It’s not that simple.”

That’s where education comes in — and why platforms like Insurance Hour matter.

“If we can help people understand how the system works, maybe we can lower the temperature and focus on solutions,” Susman said.

A Lawmaker’s Balancing Act

As both a legislator and a former peace officer, Lackey sees his role as one of mediation — between consumers who feel abandoned and insurers who say the system no longer works.

“We’re in a tough spot,” he admitted. “The people are angry, and rightly so. But we also have to ensure California remains a place where businesses can operate. If no one can afford to insure, no one can afford to live.”

That’s why Lackey supports Lara’s modernization push — cautiously, but optimistically.

“Anything that brings more carriers back to the table is worth exploring,” he said. “We just need to make sure the process stays transparent and accountable.”

What Californians Can Do Right Now

While lawmakers debate reforms, Susman offered practical advice for consumers caught in the middle of the crisis:

1. Stay informed. Follow CDI announcements and rate filings closely.
2. Work with brokers who understand the surplus and FAIR Plan markets.
3. Invest in home hardening and defensible space — these will be key under new regulations.
4. Avoid coverage gaps — even short lapses can make future policies harder to obtain.

The Human Side of Policy

Perhaps the most striking part of the conversation wasn’t about data or legislation — it was Lackey’s genuine empathy for those struggling.

“This is affecting everybody,” he said. “Families, seniors, people on fixed incomes — they’re all being squeezed.”

His message was one of shared responsibility — and shared frustration.

“It’s easy to get cynical about politics,” he added. “But I still believe we can find solutions if we work together. We just have to stop making everything political.”

Final Thoughts: Hope Through Collaboration

California’s insurance market may be in turmoil, but conversations like this one — between policymakers, industry professionals, and everyday citizens — are helping chart a path forward.

Assemblyman Tom Lackey brings something rare to the table: lived experience, both as a public servant and as someone who’s spent his life keeping people safe.

His message to Californians was simple:

“Stay engaged. Stay patient. And remember — change takes time, but it’s coming.”

For now, that means collaboration, education, and realistic expectations — because fixing California’s insurance crisis won’t happen overnight. But with leaders like Lackey pushing for reform and accountability, there’s reason to believe that progress, however slow, is on the horizon.