During a state legislative hearing on Wednesday, the California FAIR Plan president Victoria Roach informed lawmakers that the state’s property insurer of last resort is not financially prepared to cover the costs of a major disaster. The plan now faces a potential loss of 311-billion dollars, which has increased significantly from 50-billion dollars six years ago. It’s grown full tilt as private insurance firms, such as State Farm, Hartford Financial Services Group and Allstate, have left the market due to increasing natural disasters and state-imposed limits on premiums. Currently, the California FAIR plan provides coverage to approximately 370-thousand homeowners, which is double the number from five years ago. By next year, the number of homeowners covered could increase to 500-thousand.
Report: California’s State Insurance Plan Not Strong Enough to Cover a Major Disaster
