With home insurers scaling back coverage in the state, enrollment is surging in California’s backstop insurance plan — as is the plan's risk of sustaining losses that it can't cover. Victoria Roach, president of the FAIR Plan Assn., told lawmakers this week that property owners even in areas with low wildfire risk were finding it difficult to keep their homes insured as companies increased rates, limit coverage or left areas susceptible to natural disasters amid climate change.
The proposals, which aim to move people off the FAIR plan and slow the increase in premiums, have won support from insurance industry trade groups and some consumer groups, but criticism from other consumer advocates. Under the existing system, insurers need to apply to the Department of Insurance to raise their average rates across the state and prove that the price hike is justified. The process allows consumer advocates to intervene to contest the insurer's claims.