Increase Access Homeowner's Insurance Enterprises
HB1302 would create two new state-owned insurance-related enterprises within the Division of Insurance: the Strengthen Colorado Homes Enterprise and the Wildfire Catastrophe Reinsurance Enterprise. The first enterprise would charge a fee on most homeowner’s insurance policyholders, including FAIR Plan policyholders, and use the revenue to fund grants for home-hardening projects, especially resilient roofing, to reduce losses from hail, wind, wildfire, and other extreme weather. Policyholders with qualifying resilient roofs would be exempt from the fee.
The second enterprise would impose a separate fee on homeowner’s insurance policyholders in the admitted market and use that revenue, along with revenue bonds and catastrophe bonds, to provide reinsurance payments to eligible insurers after state or federally declared wildfire-related disasters. In exchange for access to the program, participating insurers would be required to write coverage in high-wildfire-risk areas and reduce premiums in those areas to reflect the reinsurance support. The bill also requires insurers to file two sets of rates beginning in 2026—one reflecting the reinsurance program and one without it—and it amends homeowner’s insurance rules to allow additional living expense coverage options with premium reductions approved by the division.
The bill would significantly affect Colorado insurance law by adding new statutory parts to Title 10, creating new enterprise funds, boards, reporting requirements, fee-collection mechanisms, and rulemaking authority. It also establishes a 75% loss-ratio presumption for homeowner’s insurance rates, under which rates may be deemed excessive if an insurer’s loss ratio is below that threshold over three years, and it directs insurers in that situation to file rates at least 5% below the prior year. The bill includes appropriations to the Department of Regulatory Agencies and the Department of Law to implement the new programs.
The general sentiment reflected in the voting history is mixed but generally supportive in the House, where the bill advanced through Finance and Appropriations and passed third reading, though with notable opposition on the floor. Several Finance amendments were adopted, suggesting substantial refinement and negotiation. In the Senate Finance Committee, however, the bill was postponed indefinitely, indicating that support did not carry through the upper chamber and that concerns remained significant enough to stop the bill there.
The main points of contention appear to be the new fees imposed on homeowner’s insurance policyholders and insurers, the scale and structure of the state’s role in the insurance market, and the requirement that insurers participate in high-risk wildfire areas as a condition of access to reinsurance support. There may also have been concern about the bill’s financial design, including revenue bonds, catastrophe bonds, and whether the enterprises properly qualify as enterprises rather than taxes under the state constitution. Supporters framed the bill as a market-stabilization and resilience measure, while opponents likely focused on cost, regulatory burden, and the breadth of the state intervention.
The bill would add two new parts to Title 10, Article 4 of the Colorado Revised Statutes, creating the Strengthen Colorado Homes Enterprise and the Wildfire Catastrophe Reinsurance Enterprise, each with its own fund, board, fee authority, reporting duties, and repeal date in 2035. It would also amend insurance rating and homeowner’s policy provisions, including requiring dual rate filings for eligible insurers and modifying additional living expense coverage rules. The bill appropriates state funds for implementation and authorizes the enterprises to collect fees, issue revenue bonds, and administer grant and reinsurance programs affecting insurers, policyholders, and the FAIR Plan Association.
The bill appears to have had meaningful support in the House, where multiple amendments were adopted and it passed third reading, but it also faced substantial opposition, as reflected in the 40-24 House floor vote and the earlier split vote in House Finance on referral. The Senate Finance Committee’s decision to postpone the bill indefinitely suggests that support was not broad enough to move it forward in the Senate, indicating a divided response overall. The discussion implied by the bill’s structure suggests supporters viewed it as a resilience and market-stability measure, while critics were likely concerned about mandatory fees, insurer obligations, and the state’s expanded role in insurance pricing and reinsurance.
The most notable contention centers on who pays for the programs and how much control the state should exert over the homeowner’s insurance market. The bill shifts costs to policyholders through fees tied to premiums, while also requiring insurers to collect and remit those fees and, for the reinsurance program, to write coverage in high-risk wildfire areas and lower premiums accordingly. Another likely point of dispute is the constitutional and fiscal structure of the enterprises, including the bill’s effort to characterize the charges as fees rather than taxes and to keep revenues outside TABOR limits. The 75% loss-ratio presumption and required rate reductions also likely raised concerns among insurers about rate regulation and profitability.