Existing law generally regulates classes of insurance, including residential property insurance. Existing law prescribes the standard form for fire insurance policies covering property.

This bill would, under a homeowners’ insurance policy, authorize an insurer to differentiate the risk of an internal fire from the risk of an external fire for the purposes of determining coverage. The bill would define terms for purposes of this provision.

2059.

(a) Under a homeowners’ insurance policy, an insurer may differentiate the risk of an internal fire from the risk of an external fire for the purposes of determining coverage.

(b) For purposes of this section, the following definitions apply:

(1) “External fire” means a fire that started outside of the insured property. An external fire may include, but is not limited to, wildfires or fires that began on a neighboring property that then spread to the insured property.

(2) “Internal fire” means a fire that started within the insured property. An internal fire may include, but is not limited to, kitchen fires, electrical fires, or fires caused by negligence on the insured property.