This article was originally published byThe Lever, an investigative newsroom.
Several weeks later, Lara announced apackageof executive actions that covered similar ground.
I will continue to partner with all those who want to work toward real solutions.
A person uses a garden hose to try to save a neighboring home during the Eaton Fire on Jan. 8, 2025, in Altadena, California.Mario Tama/Getty Images
Lara did not respond to repeated requests for comment.
As private insurersfled California, the program swelled over60 percentin the last year.
Its a predicament that will likely soon occur all over the country.
‘Weird Al’ Yankovic, Margaret Cho, Bob the Drag Queen Lead Lets Get L.Aid Wildfire Benefit ConcertL.A.
Many dont have enough set aside to pay claims while taking on enormous risks.
Its an unwelcome, overdue reckoning.
Her mind instinctively jumped to fire, but she wasnt especially worried about her own neighborhood.
But around dinner, Miller looked out her window and was shocked to see orange flames.
Its like the fire could do anything, she said.
They werent in an official evacuation zone, but we knew that it was just time.
That night, the house and a studio containing all of Millers art burned to the ground.
Only the chimney remained.
Theres nothing left, she says.
You dont even think about the kinds of things that you grab until its too late.
Losing her house is not the end, but the beginning of a frightening financial journey.
Miller rented from her father, who had purchased only nominal insurance coverage.
In 2024, Lara made a big change to how the FAIR plan covered its vast liabilities.
With over12,000 structuresdestroyed by L.A.s fires so far, that extremely unlikely event is looming.
With our changing climate, we can no longer look to the past.
California has hired justone personto oversee the accuracy of the new climate catastrophe models.
Moodyslargest shareholderis the massive holding company Berkshire Hathaway.
Its an unvirtuous circle, Balber says.
Commissioner Lara has a history with Berkshire Hathaway.
Not even the fiercest consumer advocates dispute that the climate crisis has radically reshaped the landscape of risk.
Scientists say rapidly growing fires like the ones torching Los Angeles have increased almost250 percentover the past 20 years.
Catastrophe Price Gouging
Theres a lot of money at stake.
He estimates that just under one in five homes nationwide are at risk.
What to do about all of that unpriced risk would be much easier to figure out with more information.
Insurance companies pushed back,callingit an unreasonable burden.
Just how much insurers are currently losing responding to catastrophes is hard to pin down.
There were27 different billion-dollar disastersin the U.S. in 2024, trailing a record set just the year before.
Because the industry is overseen by state governments, there are different rules for rate-setting across the country.
Some researchers havefoundthis leads to higher premiums in states with weaker oversight, regardless of the locations actual risk.
She says greater transparency is essential to address the costs of an increasingly perilous world.
Starting this month, Laraannouncedinsurance companies would be allowed to pass the costs of their reinsurance on to consumers.
There was no opportunity for public comment.
Reinsurance is a largely unregulated global market, and insurance companies usually dont disclose the terms of their contracts.
Thats nearlyfive times morethan the worlds largest oil company made in 2023.
Passing on reinsurance costs has already contributed to the homeowners affordability crisis.
State Farm did not respond to interview requests.
Since insurers now have a cap on their obligations, homeowners will be stuck with the difference.
If those costs balloon, Crawford asks, Does the state bail out the FAIR Plan?
Does the federal government get asked to come and bail out the states?
Some kind of major shift in national policies is unavoidable, Jones says.
Unlike foreclosed condos in Las Vegas, however, the effects of climate change arent going to be reversed.
Just this week, the Consumer Financial Protection Bureaufoundthat 400,000 mortgages in the South are underinsured against flood risk.
She also recommends incorporating insurance costs into buyers mortgage eligibility, which Freddie Macstarteddoing last year.
Privatizing them, as conservative advocatespushedfor in Project 2025, could quickly change how climate risks are priced.
Currently, neither enterprise directly accounts for regional differences in climate risk, effectively subsidizing credit in vulnerable areas.
Thats in part because Fannie Mae and Freddie Mac have historically prioritized expanding housing opportunities.
On Jan. 12, California Gov.
But the move does nothing to address perpetuating unsafe land use practices or future climate hazards.
No matter what we do with emissions today, many of these changes are baked in, Crawford says.
Human beings are masters at self-deception, she says wryly.
California law requires insurance companies to compensate property owners for all loss by fire.
But Schaffer says the FAIR plan has been settling claims based on illegally restricted policies.
In the two years since then, Schaffer says Lara hasnt done anything to address the problem.
Los Angeles was already facing a serious housing shortage.
Safe parking areas where people living in vehicles have access to restrooms have been burned out, he explains.
Miller, for one, isnt sure if she wants to come back to her burned-out home.
She doesnt ever want to be in that sort of situation again.
I have to start all over.
