Wednesday, August 20, 2025

Bill to Safeguard Eaton Fire Survivors’ Insurance Interest Advances Towards Governor’s Desk

Legislation aimed at ensuring wildfire survivors receive the full benefit of their insurance payouts is one step closer to becoming law, following Assembly passage of AB 493 today. The measure, authored by Assemblymember John Harabedian (D-Pasadena), is on its way to Gov. Gavin Newsom’s desk for final approval.

Known as the Disaster Interest Accrual Act, AB 493 mandates that homeowners earn a minimum of 2% annual interest on insurance proceeds held in escrow after property damage or loss. The bill seeks to close a longstanding loophole that has allowed financial institutions to retain interest earnings—often amounting to thousands of dollars—rather than returning them to families rebuilding after disasters.

“This bill makes sure homeowners—not banks—benefit from the interest on insurance payouts meant to help them recover after disaster,” Harabedian said in a statement. “Eaton Fire survivors need all the help they can get to rebuild their lives and our community. This bill will ensure that thousands of dollars go back to homeowners, rather than Wall Street. I want to thank Governor Newsom for his partnership on this measure, and my colleagues in the Assembly and Senate for recognizing the urgent need for this bill. This is about fairness and protecting families when they need it most.”

If signed into law, AB 493 would take effect immediately, offering critical relief to Los Angeles wildfire survivors and all Californians navigating disaster recovery.

Harabedian, who represents the 41st Assembly District, serves communities including Pasadena, Altadena, Sierra Madre, Monrovia, San Dimas, La Verne, Claremont, Rancho Cucamonga, Oak Hills, Piñon Hills and Phelan.