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> Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insur

> Residents who no longer have any insurers available can buy insurance from the state, but its far more expensive than the plans it rejected from private insurers Sounds like a state-run racketeering business

dlcarrier 2y ago
No, it's likely running at a loss.
- hintymad 2y ago
  Holy shit!
- loeg 2y ago
  In fact, a huge loss, which it plans to subsidize by... billing any insurers remaining in the state. > As of last Friday, the FAIR Plan had just $377 million available to pay claims, according to the office of Senator Alex Padilla, Democrat of California. It’s not yet known how much in claims the plan will face but the total insured losses from the fires so far has been estimated at as much as $30 billion. > If the FAIR Plan doesn’t have enough money to pay all its claims, it can rely on something called reinsurance — effectively, insurance for insurers in case their losses exceed a certain amount. > Senator Padilla’s staff said the plan has $5.75 billion in reinsurance available. Notably, $5.75B is less than $30B. > If the FAIR Plan can’t make up its losses from reinsurance alone, it can demand money from California’s insurance companies to make up the difference. https://www.nytimes.com/2025/01/14/climate/californias-insurance-fair-plan-fires.html https://www.nytimes.com/2025/01/14/climate/californias-insur... / https://archive.is/Xg6s9 https://archive.is/Xg6s9 California couldn't set up a more broken insurance market if it tried.
  - rawgabbit 2y ago
    So many homeowners who lost everything will find out their California backed insurance is worthless. California will ask for a federal bailout?
    - loeg 2y ago
      California's a rich state; $30B isn't totally beyond what they could extract from local industry in a year. I'm sure they'd prefer to be bailed out, but as a non-California taxpayer, I'd want any federal bailout to come with conditions that would help prevent recurrence: restricting building in dangerous areas, requirements around relaxing SFH zoning in safe areas so that developers can infill housing and meet CA's housing needs.

dlcarrier 2y ago

No, it's likely running at a loss.

hintymad 2y ago
Holy shit!
loeg 2y ago
In fact, a huge loss, which it plans to subsidize by... billing any insurers remaining in the state. > As of last Friday, the FAIR Plan had just $377 million available to pay claims, according to the office of Senator Alex Padilla, Democrat of California. It’s not yet known how much in claims the plan will face but the total insured losses from the fires so far has been estimated at as much as $30 billion. > If the FAIR Plan doesn’t have enough money to pay all its claims, it can rely on something called reinsurance — effectively, insurance for insurers in case their losses exceed a certain amount. > Senator Padilla’s staff said the plan has $5.75 billion in reinsurance available. Notably, $5.75B is less than $30B. > If the FAIR Plan can’t make up its losses from reinsurance alone, it can demand money from California’s insurance companies to make up the difference. https://www.nytimes.com/2025/01/14/climate/californias-insurance-fair-plan-fires.html https://www.nytimes.com/2025/01/14/climate/californias-insur... / https://archive.is/Xg6s9 https://archive.is/Xg6s9 California couldn't set up a more broken insurance market if it tried.
- rawgabbit 2y ago
  So many homeowners who lost everything will find out their California backed insurance is worthless. California will ask for a federal bailout?
  - loeg 2y ago
    California's a rich state; $30B isn't totally beyond what they could extract from local industry in a year. I'm sure they'd prefer to be bailed out, but as a non-California taxpayer, I'd want any federal bailout to come with conditions that would help prevent recurrence: restricting building in dangerous areas, requirements around relaxing SFH zoning in safe areas so that developers can infill housing and meet CA's housing needs.