California FAIR Plan Secures $1 Billion to Address Wildfire Claims

The state's insurer of last resort faces financial strain after record wildfire losses, prompting a controversial assessment on private insurers.

California's FAIR Plan, the insurer of last resort, is facing financial challenges after January wildfires caused billions in damages and nearly 4,800 claims.
Insurance Commissioner Ricardo Lara approved a $1 billion assessment on private insurance companies to ensure the FAIR Plan can continue paying claims.
The assessment is expected to increase costs for homeowners statewide as private insurers pass on the financial burden to consumers.
Critics argue the financial strain stems from insurers withdrawing from high-risk areas, forcing more homeowners into the FAIR Plan's limited coverage system.
The FAIR Plan's financial stability remains uncertain, with projected losses from recent wildfires estimated at $4 billion, surpassing its current reserves.