Some 11 million people live in California's high-risk wildfire zones, areas that include Los Angeles county, San Diego and the vineyards of Napa and Sonoma. Not long ago, they and homeowners in natural disaster regions around the US would have almost certainly had insurance through a big, national company like State Farm General Insurance Co., Allstate Corp. or Hartford Financial Services Group Inc.
But a growing number of insurers are cutting their business in those areas, deterred by more intense and frequent natural disasters, plus state-imposed limits on how much they can charge. Homeowners in the most risky places are now more likely to be covered by state-created, "last resort" insurance programs that provide protection where the private market won't.
Those plans have more than doubled their market share since 2018, and their liabilities crossed the $1 trillion threshold for the first time in 2022, according to Property Insurance Plans Service Office Inc., a research firm that tracks the programs. The most climate-vulnerable states are the most exposed: As of now, Florida's plan could suffer $525 billion in losses; In California, it's at least $290 billion, up sixfold from 2018.
But even as states have assumed more and more risk, they've largely dodged a fundamental question: How will they cover claims in the wake of a truly major catastrophe? There are limited options levies on private insurers or state residents, or more state borrowing and none of them are good.
Seems like home insurance customers from less hazardous places to live were subsidizing homeowners in places like California and Florida. Small wonder everyone's home insurance has went up $200.00 a year.
They'll probably look to the federal government to bail them out next after the insurers bail on them.
Of course FJB invited 10 million indigent migrants into a country that already had inadequate and unaffordable housing for it's existing citizens.
