Letter to California Senate Insurance Committee on Public Catastrophe Model
Senator Susan Rubio, Chair
Senate Insurance Committee
1020 N St., Room 258
Sacramento, CA 95814
April 23, 2025
Re: SB 429 – Public Wildfire Catastrophe Model
Dear Chair Rubio,
On behalf of Public Citizen, a national public interest advocacy group with more than 500,000 members and supporters, including nearly 100,000 members in California, we write in support of SB 429 (Cortese), which would direct California universities to develop a publicly accessible wildfire catastrophe model.
As wildfire risks intensify across California, insurers and reinsurers are increasingly relying on opaque, “black-box” catastrophe models to assess growing climate threats.These proprietary tools operate with limited transparency regarding data inputs and assumptions, leaving regulators, policymakers, and the public in the dark about the factors driving insurers’ rate hikes and underwriting decisions.
Too often, these models are inconsistent, error-prone, and susceptible to embedded biases that exacerbate existing disparities. Communities that have historically been subject to discriminatory practices may find themselves ‘bluelined’ from areas deemed to be at high environmental risk. Without transparency, the burden of risk is often disproportionately placed on low-income and historically marginalized communities, who may face rate hikes or coverage losses without any meaningful way to understand or challenge rate increase of coverage denials.
A public model can help prevent these inequities by offering consistent, open methodologies and data sources that all stakeholders can scrutinize. This would promote fairness in insurance pricing and ensure that vulnerable communities are not penalized by opaque or biased modeling practices. Given the limitations of catastrophe models, transparency is essential. By grounding these models in publicly available data and subjecting them to public scrutiny, policymakers can better protect consumers and promote equitable outcomes in the insurance industry.
The high cost of proprietary catastrophe models shuts out the public and local governments, even though these private models rely on publicly funded data. This creates a troubling information gap, where private companies profit from public resources while communities and regulators are left in the dark. Increasing public modeling capacity is essential to ensure that decision-making serves the public interest, not just private profit. Legislators should ensure that the insurance industry is not the only beneficiary of additional data and climate modeling capacity. A public model would allow for more rigorous evaluation of rate filings, improved emergency planning, smarter public investment in mitigation strategies, and provide greater regulatory oversight of proprietary models.
Public Citizen, along with a coalition of public interest, environmental justice, and consumer advocacy organizations, urges the creation of a publicly accessible wildfire catastrophe model to serve all Californians. We are encouraged by the advancement of SB 429 and strongly urge your support for this critical measure.
Please contact Mekedas Belayneh at mbelayneh@citizen.org with any questions.
Thank you,
Public Citizen
Americans for Financial Reform
Connecticut Citizen Action Group (CCAG)
Consumer Federation of America
Natural Resource Defense Council
SoCal 350 Climate Action