POLITICO Energy Why the LA fires could break California’s insurance market
Jan 10, 2025
Camille von Kaenel, a California environmental reporter for POLITICO, discusses the dire state of California's insurance market, exacerbated by ongoing LA wildfires. She explains how the fires may push the already fragile market to the brink of collapse, with private insurers withdrawing from high-risk areas. The conversation also touches on the challenges faced by homeowners due to increasing costs and the state's last-resort insurer, along with potential regulatory changes aimed at stabilizing property insurance in affected regions.
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California's Fire Insurance Crisis
- California's fire insurance market is on the brink of collapse.
- Recent Los Angeles wildfires could accelerate this collapse, impacting homeowners.
Insurer Exodus
- Private insurers are withdrawing from California due to high wildfire risk.
- This has put immense pressure on the state's insurer of last resort, the Fair Plan.
State Farm's Pullback
- State Farm dropped 70% of its policies in Pacific Palisades before the fires.
- This area now represents a significant portion of the Fair Plan's exposure.