“Wildfires continue to be a leading cause of carriers’ refusal to insure large geographic swaths of California or leaving the state altogether. Last month, in an attempt to restore stability to California’s homeowners’ insurance market, the state announced new regulations allowing insurers to charge higher premiums to protect themselves from catastrophic wildfire losses. The deregulation marks the largest insurance reform in 30 years and allows insurers to pass the cost of reinsurance on to consumers for the first time ever in California.
“Though it’s standard practice in other states, the move is intended to make the market more attractive to home insurers . For the many and growing critics of Insurance Commissioner Ricardo Lara, the walk back is ‘too little too late’ and a reminder of the downstream regulatory impact on consumers and business owners in the state. Our hearts go out to those impacted by these terrible fires.”
Ryan Ellis, of Citywide Home Mortgage, explained to MPA how this will affect insurance, “The recent wildfires in Los Angeles will likely result in substantial financial losses for insurance providers, potentially leading to further market withdrawals. This would exacerbate the upward pressure on hazard insurance costs, making homeownership even more unattainable for many residents.
“Californians already face significant challenges in affording homeownership due to high property prices, taxes, and the overall cost-of-living. Over the past decade, a series of devastating wildfires has prompted many insurance companies to withdraw from the state, driving up hazard insurance premiums.”
The fires have also brought out a more apocalyptic mentality, with reports circulating that looters have now started ransacking abandoned homes. And, despite their inordinate wealth and status, celebrities aren’t safe from the encroaching inferno either. The Pacific Palisades, home to the Hollywood elite, have been ravaged by the flames with many famous faces forced to watch their mansions burn to the ground.
