SACRAMENTO, Calif. (AP) — California’s plan that provides insurance to homeowners who can’t get private coverage needs $1 billion more to pay out claims related to the Los Angeles wildfires, the state Insurance Department said Tuesday.
The FAIR Plan is an insurance pool that all the major private insurers pay into, and the plan then issues policies to people who can’t get private insurance because their properties are deemed too risky to insure. The plans provide high premiums and basic coverage. There were more than 452,000 policies on the Fair Plan in 2024, more than double the number in 2020.
The major insurers will have to bear half the cost and can pass the rest on to all policyholders in the form of a one-time fee as a percentage of premiums. The state Insurance Department must approve those costs.
It’s the first time the Fair Plan has sought approval for additional money in more than 30 years, the department said.
The Eaton and Palisades Fires that sparked Jan. 7 have destroyed nearly 17,000 structures and killed at least 29 people.
The Associated Press
