Exploring the impact of private insurers exiting high-risk climate disaster areas, the chapter focuses on the growth of the Fair Plan as a safety net. It examines the cycle of risk, potential insurer bankruptcies, proposed reforms, and the challenges Californians face due to rising insurance rates and climate change uncertainties.
As climate risks grow, some private home insurance providers are retreating from US regions most vulnerable to catastrophe. And homeowners who can’t get coverage through the private market are increasingly turning to insurance “plans of last resort,” created by states.
The amount of liability taken on by these types of insurance plans is staggering, and growing: by some estimates, they’re holding more than $1 trillion of risk.
On today’s Big Take podcast, climate reporter Leslie Kaufman and California reporter Nadia Lopez share an investigation into how skyrocketing enrollment in state-created plans could create the conditions for a financial crisis.
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