BiggerPockets Daily Insurance Costs Begin to Rise in California Following the Fires
Feb 14, 2025
California is grappling with skyrocketing insurance costs due to wildfire risks. With the state’s FAIR Plan imposing a hefty assessment, premiums for many homeowners are set to soar. Companies like State Farm are pushing for emergency rate hikes, while private insurers pull back from high-risk areas. This crisis not only threatens affordability but could also jeopardize homeownership in one of the country's priciest markets.
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Rising Insurance Costs
- Insurers leaving California before the LA fires raised concerns about rising rates.
- This fear materialized as insurance costs are now increasing.
Wildfires Exacerbate Housing Crisis
- Wildfires add another financial burden to California homeowners due to rising risk levels.
- This, combined with existing high housing costs and disaster risks, makes homeownership challenging.
Insurance Premiums Worsen Affordability
- Rising insurance premiums worsen existing affordability challenges in California's housing market.
- The chronic undersupply of housing further complicates the issue.