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Wildfire fallout: Insurances companies have dropped 350K California homeowners in fire-prone areas
After several years of devastating fires that have destroyed thousands of properties, homeowners in those areas are also seeing their rates rise
In the last four years, wildfires have ripped through California, destroying thousands of homes in the process.
And since 2015, insurance companies have noticed, dropping around 350,000 policies in fire-prone areas, according to the Los Angeles Daily News.
New figures from the state also found that total new and renewed insurance policies increased in fire risk areas, but it did not say whether costs for those policies have gone up, according to the report.
The data doesn’t include numbers from two areas hit last year by the devastating Camp Fire: Redding and Paradise. That means nonrenewals may be higher next year.
The Camp Fire was the deadliest wildfire in state history, killing 85 people. The now-bankrupt PG&E agreed in June to pay $1 billion in compensation after it was determined the utility’s equipment sparked the blaze.
The state did not say how many people who lost insurance were able to find coverage with other insurers, but there is evidence that some buyers can only find policies with high-risk insurers.
Enrollment is up in the state’s FAIR Plan insurance program, which is expensive and usually a last resort for buyers. Surplus insurers are also seeing more business in fire-prone areas.
State regulators said that lawmakers should act to preserve the insurance market.
“This data should be a wakeup call for state and local policymakers that without action to reduce the risk from extreme wildfires and preserve the insurance market, we could see communities unraveling,” state Insurance Commissioner Ricardo Lara said. [LADN] — Dennis Lynch