LA fires could drastically drive up insurance premiums -- and test California's new market rules

[Yo_Mama_Been_Loggin]

The deadly and destructive fires in Los Angeles — which some say could be the costliest in the state’s history — will further strain the insurance market and worsen the financial position of California’s insurer of last resort.

Data about Pacific Palisades, the devastated LA neighborhood whose residents include movie stars and directors, help illustrate the insurance problems plaguing the state. An estimated 1 in 5 homes in the upscale neighborhood were covered by the insurer, known as the FAIR Plan.

Property owners in California have increasingly been turning to the plan, a pool of insurers required by state law to sell fire policies to consumers who can’t find regular insurance elsewhere. That’s because, for the past few years, insurance companies have been canceling policies or refusing to write new ones in California, citing rising risk of wildfires. As a result, the FAIR Plan’s number of homeowner policies grew to more than 451,000 as of September 2024, an increase of 123% over the past three years.

Last year, State Farm decided not to renew tens of thousands of policies in the state, including about 1,600 in Pacific Palisades. As of September, there were 1,430 residential FAIR Plan policies in the enclave’s 90272 ZIP code, an 85% increase from the previous year, according to the plan’s latest data.

https://washingtonstatestandard.com/2025/01/10/la-fires-could-drastically-drive-up-insurance-premiums-and-test-californias-new-market-rules/

[SWBTATTReg]

1. Yes, very possible. I'm watching closely. Just how many places across the Country can these insurance

companies restrict the issuance of policies to those areas of questionable safety, subject to disasters? What's next, any place where a tornado can strike, region-wise, don't issue policies. Anywhere when floods can hit, don't issue policies. Anywhere where traffic is a constant nightmare, don't issue policies. Anywhere where the murder/accident rate is high (per some artificial standard that the insurance companies themselves made up), don't issue policies.

They keep doing this then there won't be anywhere left where these companies can write policies. Might as well go out of business, refund prepaid amounts back to policy holders.