Elusive Coverage

Wildfires: the burns of 2007, 2008, 2017 and 2018 joined a long list of the “worsts” in California. The 2020 and 2021 wildfires that followed topped the list as the “worst” ever recorded, not only devastating more, an astounding millions and millions of acres in climate changed, flammable California, but also continuing the trend of obliterating California home insurers profits because of the losses and high costs of rebuilding. Compounding the risks this year are fears of damage from the rushing waters runoff from the recent storms and the super high snow pack. The result: insurers State Farm and Allstate publicly announced that they are withdrawing from the California market. Other insurers are following. Many will not be issuing or renewing home insurance policies. Those that stick around are sure to rethink the risk and cost of home insurance policies.


California wildfires are not new. Many more make up that “worst” list from years back. In 1968, reeling from the aftermath of the fires that burned in the 1960s, the California FAIR Plan was established. It is the state’s insurer of last resort, providing access to fire coverage for California homeowners who can’t get it from a traditional insurance carrier. However, its funding comes from the insurers doing business in the state in proportion to their share of the market. With fewer insurers in the state the plan is in danger of going bankrupt.


Brace for an increase in your home’s insurance policy—if one is offered by the insurer ready to take the risks, but only for the right price.