California Grapples with Insurance Crisis Following Record Los Angeles Wildfires

State Insurance Commissioner Ricardo Lara faces scrutiny over reforms and industry ties as insurers pull back from high-risk areas.

The Los Angeles wildfires, among the costliest in California's history, have caused over 15,000 structures to be damaged or destroyed, with insurance claims projected to reach $20 billion.
Insurance Commissioner Ricardo Lara's reform plan, which allows insurers to use catastrophe modeling to assess risks, aims to stabilize the market but has drawn criticism from consumer groups and political figures.
Major insurers such as State Farm are requesting significant rate hikes, including a 22% emergency increase, which Lara has temporarily denied pending further review.
Consumer advocates and former officials accuse Lara of being overly accommodating to the insurance industry, citing campaign contributions and closed-door meetings.
The state's FAIR Plan, a last-resort insurance program, faces financial strain as enrollment has surged by 250% since 2018, prompting additional fees for policyholders to sustain the system.