Californians Were More Reliant on Insurer of Last Resort in 2020

(Bloomberg) -- The number of California residents forced to turn to the state’s “insurer of last resort” climbed last year. 

Consumers getting policies from the California FAIR Plan climbed about 25% in 2020, according to data from the state’s insurance department. That was due to increases in both new policies and renewed ones. 

California’s home-insurance market has been battered in recent years by powerful wildfires that have destroyed properties and left insurers reevaluating their business in certain parts of the state. For some consumers, that’s meant pricier premiums to maintain coverage, or being dropped by their insurer completely.

While homeowners have in the past faced the possibility of insurers refusing to renew policies, the number of non-renewals last year fell about 9.7%, according to California Department of Insurance data released Monday. The regulator attributed about 80% of that decline to the fact that Commissioner Ricardo Lara imposed some mandatory moratoriums on dropping consumers.

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