Governor Gavin Newsom signed a package of four bills to strengthen California's wildfire recovery system following the 2025 Eaton and Palisades fires. The legislation creates first-in-the-nation standards for testing and remediating hazardous wildfire smoke contamination and requires insurers to cover qualifying smoke-damage testing and restoration costs.
The California Department of Insurance estimated that more than 13,000 of roughly 40,000 insurance claims filed after the January 2025 fires involve smoke damage to homes that never burned. Until now, no state had enforceable standards for how those homes should be tested, cleaned, or restored. Assembly Bills 1642 and 1795 direct the Department of Toxic Substances Control and the California Air Resources Board to develop protections for testing and remediation of lead and asbestos contamination from wildfire smoke in homes within a fire's zip codes. Insurers are now required to pay for testing and remediation and cover full cleanup and restoration to pre-loss condition.
The legislation also makes permanent mortgage forbearance protections the Governor secured from loan servicers following the LA fires. The law doubles the mortgage forbearance window for LA fire survivors from 12 to 24 months and requires servicers to offer borrowers the option to defer repayment of missed payments until the end of the loan, unless prohibited by investor contract terms or servicing guidelines.
Newsom said, "These new protections will make insurer obligations clearer and give homeowners more financial flexibility when they need it most."
The bills pair with existing state programs including the CalAssist Mortgage Fund, which provides survivors up to 12 months and $100,000 in mortgage relief that does not need to be repaid, and the $100 million Disaster Rebuilding Fund to make rebuilding loans more accessible and affordable.