AB-567 • 2026

Insurance: residential and commercial.

Budget Taxes

Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor: DeMaio
Last action: 2026-02-02
Official status: From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
Effective date: Not listed

Plain English Breakdown

The bill summary does not specify if there are any limits or conditions under which the state would fund excess insurance rate increases, other than requiring an appropriation. This detail is left open to interpretation based on legislative processes and budget allocations.

Insurance Changes for Homes and Businesses

This law sets limits on how much residential property insurance rates can increase each year, reduces taxes on these policies until January 1, 2030, and requires a report to the Legislature about ways to make regulations less strict.

What This Bill Does

Sets a limit on how much residential property insurance rates can go up in one year. If the rate goes up by more than 7% or above the national average increase, whichever is lower, the state will pay for the extra cost upon appropriation.
Reduces taxes on premiums received for home insurance policies to zero percent until January 1, 2030.
Requires a report from the Department of Insurance and insurers about how to make regulations less strict so that residential property insurance rates stay low or go down.

Who It Names or Affects

Homeowners who buy residential property insurance
Insurance companies that sell home insurance policies

Terms To Know

Department of Insurance: The government agency in charge of regulating insurance companies and practices.
Gross Premiums Tax: A tax that is charged on the total amount of money an insurance company collects from policyholders.

Limits and Unknowns

The bill only applies to residential property insurance, not commercial or other types.
It requires state funding if home insurance rates go up too much, but this depends on whether there is enough money in the budget.
Some parts of the law will end on January 1, 2030.

Bill History

2026-02-02 California Legislative Information
From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.
2026-01-31 California Legislative Information
Died pursuant to Art. IV, Sec. 10(c) of the Constitution.
2025-04-28 California Legislative Information
In committee: Set, second hearing. Held under submission.
2025-04-21 California Legislative Information
In committee: Set, first hearing. Referred to suspense file.
2025-03-28 California Legislative Information
(Ayes 46. Noes 17. Page 908.)
2025-03-28 California Legislative Information
Re-referred to Coms. on REV. & TAX. and INS. pursuant to Assembly Rule 96.
2025-03-11 California Legislative Information
Re-referred to Com. on INS.
2025-03-10 California Legislative Information
From committee chair, with author's amendments: Amend, and re-refer to Com. on INS. Read second time and amended.
2025-03-10 California Legislative Information
Referred to Coms. on INS. and REV. & TAX.
2025-02-13 California Legislative Information
From printer. May be heard in committee March 15.
2025-02-12 California Legislative Information
Read first time. To print.

Official Summary Text

AB 567, as amended, DeMaio.
Insurance.
Insurance: residential and commercial.
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 state the intent of the Legislature to enact legislation related to reforming the insurance market.
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.

Current Bill Text

Read the full stored bill text

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