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A terrific article from Politico about home insurers in California and the wildfire/ nonrenewal challenges facing this state.
California continues to face wildfire risks. Insurers think they have an answer.
By DEBRA KAHN
12/30/2021 08:53 PM EST
"SAN FRANCISCO — California is struggling to prevent wildfires from decimating communities each year. Now insurers wonder if they can accomplish what politicians can't.
State leaders are pouring money into firefighting and clearing brush from drought-parched forests. They've allowed utilities to cut power on the riskiest days. But they've done little to discourage residents from living in extreme fire areas. And they've continued to allow development on the outskirts in a state desperate for housing.
Enter the insurance industry, which says it can no longer afford to back homes facing a high risk of burning up each year. It's pushing for a new model that would account for future climate change risks — an approach that California has been alone in resisting....
That has led to a reckoning over whether California should allow insurers to account for future climate change risks.
The industry is arguing the state should let the market reflect the true risk. Insurers say the time is ripe to unlock a long-sought policy tool: Basing rates on estimates of fire damages to come, rather than actual damages from the previous 20 years...."
California continues to face wildfire risks. Insurers think they have an answer.
By DEBRA KAHN
12/30/2021 08:53 PM EST
"SAN FRANCISCO — California is struggling to prevent wildfires from decimating communities each year. Now insurers wonder if they can accomplish what politicians can't.
State leaders are pouring money into firefighting and clearing brush from drought-parched forests. They've allowed utilities to cut power on the riskiest days. But they've done little to discourage residents from living in extreme fire areas. And they've continued to allow development on the outskirts in a state desperate for housing.
Enter the insurance industry, which says it can no longer afford to back homes facing a high risk of burning up each year. It's pushing for a new model that would account for future climate change risks — an approach that California has been alone in resisting....
That has led to a reckoning over whether California should allow insurers to account for future climate change risks.
The industry is arguing the state should let the market reflect the true risk. Insurers say the time is ripe to unlock a long-sought policy tool: Basing rates on estimates of fire damages to come, rather than actual damages from the previous 20 years...."
