Los Angeles Fires Become Existential Test for California’s Stopgap Insurer

Jeremy Porteramerican singer and songwriter

The downside of that is, there's a correction that has to be made. There's what I call a climate debt,

Porter says

Jeremy Porteramerican singer and songwriter

I think that California is being progressive in a lot of ways in the insurance market,

What they're saying ... says Jeremy Porter, head of climate implications research at risk modeling firm First Street

SFG has managed its policy growth by limiting writing in high-risk areas for many years, and more recently, by ending all new policy sales,

Hardin added

As we discussed, SFG’s capital position has severely deteriorated, and we are increasingly concerned about its financial well-being,

Hardin wrote

We must now take action to reduce our overall exposure to be more commensurate with the capital on hand to cover such exposure, as most insurers in California have already done,

she wrote

The swift capital depletion of SFG is an alarm signaling the grave need for rapid and transformational action, including the critical need for rapid review and approval of currently pending and future rate filings,

she wrote

We are aware of misinformation being posted online regarding the FAIR Plan’s ability to pay claims,

spokesperson Hilary McLean said in a statement on behalf of the FAIR Plan

It’s like trying to fight a 200-foot-tall dragon with a tiny little sword. You’re not going to win,

Whaling said

The state-led, state-designed and state-implemented agenda really cannot be stopped by Donald Trump,

he told E&E News’ Adam Aton

We may have crossed a threshold now where we need larger measures in order to essentially create a solvent insurance system,

said Michael Wara, director of Stanford’s Climate and Energy Policy program and a consultant to the California Public Utilities Commission on wildfire issues

This is sort of what everybody’s been preparing for,

said Karl Susman, an insurance broker in West Los Angeles who’s filing dozens of claims on behalf of clients

I look at his election as less of a hobble and more of a spur to our efforts,

he added

Communities that are built in the wildland-urban interface will always be threatened by these kinds of fires,

he said

I don’t know that any place in the world has a system like that,

he said

We are acutely aware of the political challenges that the actions needed to improve [State Farm's] financial position pose to broader reform efforts. Please know that we have an ongoing desire and commitment to collaborate with you and your staff, as well as the Governor's office, to achieve these reforms as quickly as possible."

State Farm President and CEO Denise Hardin wrote to California Insurance Commissioner Ricardo Lara last year

As shared with the Department prior to the February 2023 filing, rate increases alone would likely be insufficient to restore SFG's financial strength,

Hardin wrote

Ricardo Laracalifornia Insurance Commissioner

Californians deserve a reliable insurance market that doesn't retreat from communities most vulnerable to wildfires and climate change,

Lara said in a statement last month

Doesn't look good for those who live there. I'm wondering if insurance companies will treat them better than those that got flooded out and lost their homes in the east US, Appalachia area?"

Rick Saxton, an X user from Wyoming, said on the platform

James Woodsactor

Actually one of the major insurance companies canceled all the policies in our neighborhood about four months ago."

Actor James Woods, a resident of Palisades, responded

We recognize that the insurance market in California is challenging and securing property insurance has become more difficult. We are doing everything we can to support our customers during this time,

a State Farm spokesperson told the Chronicle at the time