We've talked about how wildfire risks multiply simply by having more and more and more people living in previously wild or semi-wild areas.
Then when you run electricity into these areas that are no longer allowed to burn naturally, when the wires break and the land does catch fire, you have a disaster on your hands.
From the Wall Street Journal:
February 10, 2019
“It’s getting harder and harder to find someone to write [insurance for] any given particular piece of property,” said Bob Anderson, co-owner of Fromarc Insurance Agency Inc. in South Lake Tahoe, Calif.
Insurers including State Farm and Allstate Corp. have filed to raise home-insurance rates in the past six months. The California FAIR Plan, the state insurer of last resort, said it would implement an average 20.3% price increase in April, with the largest increases for policies in wildfire-exposed areas.
California has always been prone to wildfires, but insurers say the risk is increasing as fire-prone areas have become increasingly populated and a warming planet adds new uncertainty to natural catastrophes. State wildfires in 2017 and 2018 cost insurers more than $23 billion, according to the California Department of Insurance. Some market participants expect that total to rise.
“Homeowners in any area with high risk will likely have fewer options for coverage,” Ricardo Lara, California’s insurance commissioner, said in a statement.
The vast majority of California homeowners are still insured by standard insurers like State Farm and Farmers Insurance. But growing numbers are buying insurance from surplus carriers that specialize in unusual risks, an option that is available only to homeowners rejected by traditional insurers. Surplus policies tend to be more expensive, and they don’t need state approval for the prices they charge.
Surplus insurers sold about 49,000 homeowner policies representing $122 million in premium in 2018, up from 30,500 policies and $77.6 million in premium in 2014, according to the Surplus Line Association of California.....MUCH MORE
One homeowner who turned to surplus insurance was Eileen Kleinschmidt, who was on vacation in early 2017 when she found out her insurer, Hartford Financial Services Group Inc., wouldn’t renew the $1,600 annual policy on her three-bedroom house in Sutter Creek, Calif. Ms. Kleinschmidt’s house wasn’t damaged in a recent fire, but it is in a high-risk area for wildfires....
