Homeowners in high wildfire-risk areas are finding it harder to secure insurance due to recent wildfires, according to data collected by the California Department of Insurance.
Insurance Commissioner Ricardo Lara said the department is seeing "an increasing trend" where people at risk of wildfires are not being renewed by insurers. The department found a 6% increase in insurer-initiated homeowner policy nonrenewals in the Cal-Fire State Responsibility Areas from 2017 to 2018, while zip codes affected by fires from 2015 to 2017 saw a 10% increase in insurer-initiated nonrenewals in 2018.
The data provided by insurers also shows that availability of homeowners insurance fell in high-risk counties. In the 10 counties with the most homes in high or very high-risk areas, the number of new and renewed homeowners policies fell by 8,700 from 2015 to 2018. These counties also recorded a steady increase of up to 177% in FAIR Plan policies in the same timeframe, compared with a 4% increase in five counties with the lowest wildfire risk.
FAIR Plan policies provide coverage as a last resort for homeowners who are unable to find insurance in the voluntary market. Data shows that nearly 57% of these policies are now written in State Responsibility Areas, an increase from 47% in 2015. These areas also saw a 49% increase in surplus lines policies from 2015 to 2018.
The data does not measure the full impact of nonrenewals of homeowner policies linked to the 2018 wildfires, including the Camp, Carr and Woolsey/Hill fires.
