UC Law Journal
Abstract
California is currently facing an insurance crisis. The increased impact of climate change, including extreme droughts and wildfires, poses new risks to the insurance industry, especially when it comes to homeowner’s insurance. Insurance providers have limited their homeowner coverage, with many companies leaving the state entirely due to the undervaluation of climate risk in the policies they provide. A so-called “climate insurance bubble” is already beginning to burst. The state’s last-resort public insurance program, the FAIR Plan, has expanded rapidly to fill in for the lack of insurance providers in the state. But because FAIR Plan policies are expensive and limited, many Californians are forced to go without any home insurance coverage at all.1 This Note will examine California’s ongoing insurance crisis, focusing on the factors driving the increased severity and frequency of wildfires in the state. It will then explore the impact of these wildfires on the housing market and provide an overview of California’s insurance regulations and the current state of the insurance market. The Note will highlight the drawbacks and benefits of sustainable Insurance Strategy, and offer recommendations to strengthen wildfire insurance regulation by incorporating more consumer-focused strategies. The recommendations include providing additional financial incentives for homeowners to fireproof their properties, expanding wildfire preparedness education, and rebuilding communities affected by fires with greater resilience by utilizing smarter, more sustainable land use practices.
Recommended Citation
Mackenzie Paskerian,
Insurance Under Fire: Assessing How California’s Insurance Industry is Tackling the Wildfire Crisis and What’s Next,
76 UC Law SF L.J. 1809
(2025).
Available at: https://repository.uclawsf.edu/hastings_law_journal/vol76/iss6/11