New bill aims to allow California AG to sue oil companies for disaster costs
A California legislator wants the state to be able to sue oil companies to pay for insurance losses and higher prices following fires, floods and other disasters.
“We know that the years ahead are going to be dramatically more dangerous,” said state Sen. Scott Wiener, D-San Francisco, who authored the new bill. “And we can’t allow Californians, our residents, our small businesses, to be left holding the bag.”
The proposal, Senate Bill 982, aims to allow the attorney general to bring lawsuits to recoup money for premium increases for insurance policyholders and claims payouts by the California FAIR Plan, a backup provider for residents who can’t find fire coverage.
The FAIR Plan has seen rapid growth in recent years as traditional insurance companies have decided not to renew the coverage of many of their policyholders due to losses from past fires and concerns about the rising risks of major ones in the future. That has left Californians with few or no other options.
Last year, the plan was allowed to seek $1 billion following the devastating Los Angeles-area fires. It is funded by insurance companies that sell homeowner policies in the state, but half of that money may ultimately be covered by policyholders. In total, it has paid out more than $3 billion due to those fires, and last year it asked to raise its coverage rates by an average of 35.8% for homeowner policies.
Wiener argues that oil companies should be on the hook because major fires, heatwaves, droughts and other severe weather events — and the insurance challenges they have caused — are the result of the corporations hiding the risks of using their products.
“The climate disasters underlying the insurance crisis in California are the result of a decades-long, coordinated campaign of deception launched and orchestrated by major fossil fuel companies,” the bill reads.
Petroleum industry’s response
Jim Stanley, a spokesperson for the Western States Petroleum Association, an oil industry trade group, wasn’t a fan of that argument.
“This is a political stunt that will kill jobs and increase costs for consumers,” he said in a statement.
A FAIR Plan spokesperson said it was reviewing the bill and did not have a comment at this time.
Joining Wiener at a press conference Thursday morning were Californians who were dealing with the fallout of recent fires and flooding. Gayle and Rasheed Ali were out of the country when flames destroyed their home of more than 30 years in the Altadena neighborhood that was severely damaged by last year’s Southern California fires.
“Families across California are learning the same painful lesson,” said Gayle, 69. “After disaster, insurance falls short and survivors are left holding the bill.”
Wiener said the attorney general could use money collected from civil lawsuits to recover costs paid by policyholders for higher premiums, provide payments to the FAIR Plan and to support grants for Californians to make their properties more resistant to fires.
The Attorney General’s Office did not immediately respond to a request for comment on the proposal, neither did a representative for the American Property Casualty Insurance Association, a national home and auto coverage trade group.
Wiener and other supporters acknowledged that the bill will face stiff and well-financed opposition.
“As this gets worse and worse and worse, the state has to do really serious things to address the issue,” said Mary Creasman, CEO of California Environmental Voters.
Legislators will have until Aug. 31 to pass the measure.
This story was originally published February 5, 2026 at 10:30 AM with the headline "New bill aims to allow California AG to sue oil companies for disaster costs."
