California FAIR Plan asks state for major increase for home insurance coverage
The California FAIR Plan, the state’s backup insurance provider, is asking to raise its coverage rates by an average of 35.8% for homeowner policies.
That’s according to a recent filing with the Department of Insurance by the state-created, but privately funded, plan.
Hilary McLean, a spokesperson for the plan, said the main driver “of the increase is attributable to the wildfire portion of the premium.”
The request is just the first step in a department review process and the rate hike that is ultimately approved could be lower.
Michael Soller, a department spokesperson, said the agency would closely review the filing “to make sure consumers do not pay more than is required.”
The number of people using the FAIR plan for fire insurance has increased dramatically in recent years as companies have pulled back business in the state due to losses caused by major wildfires arising from risks due to climate change and other factors.
“There’s no question a rate hike that size would be a huge blow to all the homeowners already paying a lot for too little coverage at the FAIR Plan,” said Carmen Balber, executive director for Consumer Watchdog, an organization that closely watches the insurance industry.
The plan is funded by insurance companies that do business in the state. As of June, it had 590,642 residential policies in place, more than double the total it had just three years earlier. Earlier this year, following the devastating Los Angeles-area fires, the plan was allowed to seek $1 billion from insurance companies, half of which could ultimately be paid for by policyholders from those companies.
McLean said the plan was working with the department to “ensure its rates reflect the current risk portfolio, expenses and growth as the state’s insurer of last resort.”
This story was originally published October 2, 2025 at 5:57 PM with the headline "California FAIR Plan asks state for major increase for home insurance coverage."
