“The glut of homes in increasingly fire-prone places has created an insurance crisis in California, with many big insurers pulling out of the state to avoid more losses. Nearly 500,000 Californians have turned to the state’s insurer of last resort, the FAIR Plan, which has doubled in size over the past five years. The state is now exposed to nearly $458 billion in potential damage, a figure that has nearly tripled since 2020.
The neighborhoods in the path of the Palisades and other fires burning this week have been among some of the hardest-hit by insurer defections in recent years. The 90272 ZIP code of Pacific Palisades experienced 1,930 policy non-renewals between 2019 and 2024, according to a San Francisco Chronicle tally, or 28 out of every 100 policies.
Pacific Palisades is also the state’s fifth-largest user of FAIR policies, with nearly $6 billion in exposure. Even a fraction of that amount would exceed the capabilities of FAIR, which at last report had about $700 million in cash.”
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