"The California FAIR Plan, the state's home insurer of last resort, is seeking an average 35.8% rate hike, its largest in years, following billions of dollars of losses incurred in the January firestorms. The Los Angeles-based insurance pool, operated and backed by the state's licensed home insurers, filed this week for the dwelling policy rate hike, which must be reviewed and could be reduced by the state insurance commissioner."
"The plan, which has added hundreds of thousands of policyholders in recent years as insurers have pulled back from the market amid rising wildfires, has estimated losses of $4 billion from the January blazes. Those losses forced it to assess its member carriers $1 billion in order to pay all claims. The rate hike would hit individual homeowners unevenly, with many experiencing greater increases and others seeing decreases if they live in neighborhoods that are not prone to wildfires."
"The new rates would apply in April, and homeowners can seek discounts of up to 15% if they take steps to reduce the fire risks on their property. The rate hike, if approved, would easily top increases of 20.3% in 2019 and nearly 16% in 2021 and 2023. However, the 2023 rate hike of 15.7% was cut down by Insurance Commissioner Ricardo Lara from the 48.8% sought by the plan."
The California FAIR Plan seeks an average 35.8% rate increase for dwelling policies after estimating $4 billion in losses from January firestorms and assessing member carriers $1 billion to pay claims. The Los Angeles-based insurer of last resort has added hundreds of thousands of policyholders as private insurers retreated amid rising wildfires. By statute rates must cover anticipated claims and expenses, and the proposal must be reviewed by the state insurance commissioner, who can reduce it. The increase would affect homeowners unevenly, with discounts up to 15% available for property fire-risk reductions. The plan faces criticism over smoke-damage claim handling and lawsuits from homeowners in Altadena, Pacific Palisades and nearby communities.
Read at Los Angeles Times
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