California FAIR Plan Exposure Up Drastically in 2025

California’s insurer of last resort, the FAIR Plan saw an exposure increase of 42% in the first three quarters of 2025. More people either forced — or chose to — use the FAIR Plan for insurance. Limitations of coverage from insurers, and the withdrawal of some insurers from the high risk market, and an increase in people enrolling in the plan are responsible for the increase.

That puts the plan’s total exposure at $650 billion.

“Increasing risks due to climate-driven wildfires and a lack of adequate insurance rates have resulted in fewer coverage options available to consumers in the voluntary market,” the FAIR Plan said in a news release.

Active policies rose 31% since the end of the last fiscal year in September of 2024. That puts enforce policies at 610,179. With that increase came an increase of written premiums of 33% to $1.84 billion.

Of the $1.84 billion, $1.64 billion are residential properties. Commercial risks totaled $201.2 million.

The increases, along with huge losses from wildfires and the withdrawal of insurers from the high-risk areas, pushed the FAIR Plan into an $800 million deficit that participating insurers were forced to cover.

Source link: Insurance Business America — https://bit.ly/46WWSxT