California Housing Market Hit by Wildfires

In Cohasset, California, homeowners Michael and Jennifer Daneau have encountered significant challenges in securing homeowners insurance due to escalating wildfire risks. After being denied coverage by multiple insurers, they finally found a plan, but its cost was prohibitive. The ongoing climate crisis has intensified the frequency and severity of wildfires in the state, exemplified by the destruction of approximately 19,000 structures during the devastating 2018 Camp Fire. The California Department of Insurance has documented a troubling trend since 2015, revealing a rise in policy cancellations and non-renewals in high fire-risk areas, which encompass over a quarter of the state. Recently, State Farm, California's largest insurer, proposed a 30% rate increase for homeowners' insurance, further exacerbating the situation. Many residents, unable to secure private insurance, have turned to the California FAIR Plan, a state-backed last-resort option that has seen a staggering 164% increase in policies since 2019. Despite the FAIR Plan's availability, the Daneaus express frustration over its affordability, likening the costs to a mortgage payment. This trend reflects a broader issue, as many Californians struggle to find accessible insurance options. In response, initiatives like the Wildfire Prepared program aim to enhance home resilience against wildfires, but homeowners remain uncertain about their future. Michael Daneau articulated this anxiety, stating, “I’m personally so numb that I just can’t wrap my head around where we’re going to go.”