Senator Ben Allen - S.B. 495 - Eliminate the List - – A New Law Could Change Everything!

Published Date: 03/21/2025

SB 495: How California’s “Eliminate the List Act” Could Transform Disaster Recovery for Homeowners

When disaster strikes, the last thing homeowners should face is bureaucracy. Yet, in the aftermath of devastating California wildfires, many residents who lost everything were confronted not only with grief and displacement—but also with an overwhelming demand from their insurers: produce an itemized list of every possession lost, or risk losing your claim.

Senator Ben Allen’s proposed legislation, SB 495, also known as the Eliminate the List Act, aims to end this burden. In a recent interview on Insurance Hour with Karl Susman, Senator Allen discussed how this bill would remove the requirement for fire victims and total-loss homeowners to compile exhaustive inventories after catastrophic loss. The conversation offered profound insight into the intersection of insurance regulation, consumer protection, and market stability in California.

The Problem: When Total Loss Becomes Total Bureaucracy

Imagine losing your home in a wildfire—everything from furniture and clothes to family heirlooms and important documents. Then, while staying in temporary housing, trying to enroll your kids in new schools, and navigating FEMA paperwork, your insurance company asks you to list every single item you want reimbursed for—often numbering in the thousands.

As Senator Allen put it, “It’s a re-traumatizing experience.” Many survivors have no photos or receipts of what was inside their homes. While some insurers voluntarily waived the itemization requirement and provided full payouts, others demanded proof, making the recovery process agonizing.

The Eliminate the List Act (SB 495) seeks to change that. Under the bill, homeowners who experience a total loss—meaning their homes are completely destroyed—would no longer be required to itemize their personal belongings to receive the full value of their contents coverage.

What the Bill Proposes

The essence of SB 495 is simple but powerful:
If a homeowner’s property is declared a total loss, insurers must automatically pay 100% of the policy’s personal property coverage without requiring an itemized inventory.

This would apply whether the loss results from a wildfire, earthquake, or any other covered peril under the homeowner’s insurance policy—not just state-declared disasters.

As Karl Susman noted during the interview, many insurance contracts already require partial payouts—often 30–40% upfront. However, the California Department of Insurance (CDI) previously urged insurers to increase that to 100% following major fires, and most carriers complied. Senator Allen’s bill would standardize this practice into law, ensuring consistency and fairness for all homeowners.

Retroactivity and Implementation Challenges

One major question discussed during the interview was whether SB 495 would apply retroactively—that is, whether homeowners who already suffered total losses could benefit from it.

Senator Allen was candid: while retroactive application “would be great to help folks,” it introduces significant complexities. Insurance contracts are legal documents, and modifying them after a loss could trigger legal disputes or financial strain on insurers. Therefore, the bill will likely apply going forward, but Allen emphasized that his office is “pushing companies to step up voluntarily.”

Balancing Compassion and Contractual Reality

Every insurance policy is a contract: insurers agree to pay for losses that are properly documented. Traditionally, this means policyholders must prove what they owned and what it was worth.

Karl Susman raised an important point—if insurers stop requiring documentation after the fact, might they start demanding more documentation before issuing policies? Senator Allen responded that he’d welcome that shift: “It’s much easier to collect information on the front end than on the back end when you’ve lost everything.”

This approach could also lead to more accurate coverage amounts. Currently, many insurers use a rough percentage—often 50–70% of the home’s insured value—to calculate personal property coverage. But that’s arbitrary. Some people live minimally; others may own high-value collections or technology. A front-end conversation about property value, paired with photographs or digital records, could create more transparent and realistic coverage.

Consumer Experience and the Human Side of Insurance

Beyond legalities, SB 495 is about humanizing disaster recovery. Senator Allen shared stories from constituents who lost everything in the Palisades and Altadena fires. For these homeowners, the list requirement wasn’t just an inconvenience—it was an emotional ordeal layered atop trauma.

“FEMA only pays about $750 initially,” Allen explained. “They’ll help more later, but only for things not covered by insurance. So if the insurance company doesn’t pay promptly, people are left without the resources they need to rebuild their lives.”

By ensuring that policyholders receive the full value of their contents coverage automatically, the bill gives victims the financial liquidity they need to stabilize quickly—covering essentials like housing, school supplies, and childcare.

Regulatory Perspective: The Department of Insurance and the Market Crisis

A recurring theme in the interview was the broader insurance crisis in California. With climate-fueled disasters increasing and regulatory constraints under Proposition 103, many major insurers have reduced or paused new business in the state.

Allen acknowledged the tension: “If we pursue policies that collapse the solvency of the insurance system, we won’t be able to help anybody.” Yet, he credited Insurance Commissioner Ricardo Lara and the CDI for their responsiveness to wildfire victims, saying they’ve “helped a lot of people” and even organized local recovery events connecting carriers with victims.

The senator also discussed the importance of predictive modeling—allowing insurers to use forward-looking data on climate risks rather than relying solely on historical losses. Without this shift, insurers can’t accurately price risk, leading to market withdrawal.

The “Socialization” of Insurance Costs

One of the most insightful parts of the conversation was Allen’s explanation of “socialized risk.”
Under current regulations, insurers must spread the cost of high-risk properties (like mountain or canyon homes) across all policyholders statewide. This means even homeowners in low-risk urban areas are seeing premium hikes to subsidize coverage in wildfire zones.

While this keeps insurance somewhat affordable for those in high-risk regions, it raises questions of equity and sustainability. “There’s a point at which the costs and risks are so high for some properties,” Allen said, “that it raises equity questions as to how much we should make everyone else pay for it.”

Susman agreed, noting that while California values fairness and inclusivity, a “one-size-fits-all” pricing system can backfire when natural risk levels differ drastically across regions.

Potential Reforms and the Future of Coverage

Both Allen and Susman discussed creative solutions for balancing affordability and access. Ideas included:

• Expanding consumer choice: Allowing buyers to select minimal coverage for reduced premiums—essentially a “bare-bones” option.
• Mortgage-linked insurance products: Developing policies that protect the lender’s investment (similar to “forced insurance”) while giving consumers flexibility.
• Revising Prop 103: Introducing reforms that allow insurers to price risk accurately while maintaining transparency and oversight.

Allen emphasized that reform must “put consumers at the heart of the system” but also ensure the solvency and stability of the insurance market. Without functioning carriers, even the most consumer-friendly laws lose impact.

Why SB 495 Matters

The Eliminate the List Act represents more than just an administrative reform—it’s a reflection of California’s shifting priorities in the face of escalating climate risks. It balances compassion for victims with the need for systemic modernization.

By easing the claims process for total-loss victims, it restores trust in the insurance system, encourages responsible underwriting, and reminds consumers that their years of premiums were not paid in vain.

For lawmakers, insurers, and policyholders alike, SB 495 is a test case for how California can evolve its regulatory framework without sacrificing fairness or solvency.

Takeaway: Insurance Is About People, Not Just Policies

As Karl Susman summed it up, “Consumer choice is what I’m all about.”
SB 495 carries that same spirit—ensuring Californians can recover from disaster with dignity, without reliving their losses through paperwork.

While challenges remain, the Eliminate the List Act is a vital step toward a more humane, transparent, and resilient insurance landscape—one that truly protects Californians when they need it most.