The fire insurance industry faces mounting financial risks as New Mexico experiences more frequent and intense heat waves 鈥� triggering massive wildfires.
On Tuesday, lawmakers on the Senate Conservation Committee unanimously advanced a bill that takes aim at skyrocketing premiums or policy cancellations by proactively planning for future fires.
Overall, large swaths of the state are labeled as 鈥渁t-risk鈥� from wildfire according to the Energy, Mineral, and Natural Resources Department (EMNRD).
So, when areas like , insurers become increasingly reticent about writing policies.
SB 33 鈥� or the 鈥� amends the Forest Conservation Act, creating a program and fund to help reduce community wildfire risk and, in turn, entice insurance companies to offer affordable policies.
Co-sponsor of the bipartisan bill, Harlan Vincent (R-Ruidoso), is confident it will have lasting impacts.
鈥淵ou鈥檙e going to see a lot of the insurance prices go down and insurance companies are going to want to insure your home because they know they鈥檙e safe,鈥� Vincent said. 鈥淏ut, right now, it鈥檚 just so unpredictable because our forests are so thick.鈥�
Just last month, the U.S. Department of the Treasury outlining the rising costs and declining availability of homeowners insurance across the nation. Here in New Mexico, 36 of 200 ZIP codes analyzed were in the top 20% highest risk for climate-related weather events, like wildfire according to .
Sponsors estimate current insurance prices could drop as much as 20%, but admit there will be a struggle encouraging underwriting in wildfire-ravaged areas. Usually, companies will pull back for a couple months to a year before revisiting new policies, depending on the severity of the wildfire.
The bill allocates $20 million from the general fund to start the implementation, some of which will be used for hiring and training four full-time employees in the Forestry Division of EMNRD.
Another element expands the to 16 members. The group meets yearly to adopt codes, protection plans, and ordinances. State agencies, local governments, fire departments, insurance groups, and tribal nations would participate.
But, as debate progressed, it was evident other issues outside the bill鈥檚 scope help exacerbate wildfires.
State Forester Laura McCarthy, who sat in the expert seat for the bill鈥檚 Senate Conservation Committee hearing, said that 95 of the top 100 at-risk watersheds in New Mexico are in federally-run national forests, where she does not have the authority to thin trees.
鈥淭ry as we may, we are not successful at getting the tree-thinning that鈥檚 needed at the scale that鈥檚 needed,鈥� McCarthy said.
While bill sponsors couldn鈥檛 explain their rationale behind the $20 million appropriation, Gov. Michelle Lujan Grisham鈥檚 has the same amount for 鈥渨ildfire mitigation programs and initiatives.鈥�
Separately, the governor has also made a $800,000 ask for wildfire mapping of hazard and risk. If appropriated, it would aim to improve the state鈥檚 understanding of where to invest money first.
The state鈥檚 top executive is also interested in tackling the problem directly. In her State of the State address at the beginning of the session, Gov. Lujan Grisham proposed a state-sponsored, for-profit fire insurance program outside of the private market. This would be separate from the state鈥檚 more expensive 鈥渋nsurer of last resort鈥� plan called the (FAIR).
During its time in the limelight, not a single person spoke up in opposition to SB 33.
Augustus 鈥淕us鈥� Pedrotty, a firefighter paramedic with Albuquerque Fire Rescue, supports the bill because it involves the community.
鈥淎s it鈥檚 been noted 鈥� it takes everyone, right? Fires spread through wind, through superheated gasses, and embers,鈥� Pedrotty said. 鈥淗omes burn hot because of plastics. This is a crucial step we can take to defend our entire state.鈥�
Overall, at least 50% of the money pool will be set aside to improve home fire resistance by upgrading building materials and landscaping to reduce hazardous fuels. This would be made available to the public through grants.
The bill itself includes new standards and certifications for existing and new homes, but doesn鈥檛 necessarily mandate them.
In the future, the Fire Planning Task Force could set stricter guidelines as these rules are developed and incentivize these changes through financial assistance, further 鈥渇ire-proofing鈥� homes.
Senate Bill 33 cleared the Senate Conservation Committee on a unanimous vote. Its next stop is the Senate Finance Committee.
If it survives and is signed by Gov. Lujan Grisham, the law would take effect immediately.
