Los Angeles fires spark fears California home insurance prices could spike
SACRAMENTO — As wildfires rip through Los Angeles County, there are already new fears of more homeowner's insurance price hikes spreading across California.
The urban inferno is now raising concerns about what's next: Could there be another explosion in home insurance policy costs?
Carmen Balber is the executive director at Consumer Watchdog, a nonprofit that monitors California insurance companies.
"It feels apocalyptic in L.A. right now, and it feels like things have changed for anyone who is in the middle of this right now, and I think we just have to take a step back," Balber said.
These deadly wildfires come just as the state insurance commissioner proposed new rules requiring insurance carriers to offer coverage of homes in high-risk areas with a trade-off: increased prices for all policyholders.
Congressman John Garamendi, the former California insurance commissioner, said insurance companies will use these fires to raise policy prices for everyone.
"Every homeowner, every business in California will be affected by this fire," Garamendi said. "It's going to be a major effort from the effort to use this fire and other fires to jack up the rates."
Republican Assemblymember Bill Essayli called on Gov. Gavin Newsom to propose a special session to create new laws in response to the L.A. wildfires.
"Look, we were already on the brink. This is going to push us over," Essayli said. "This is going to accelerate the run to the exit. Insurance companies are going to go out of the state even faster. This is a disaster. It's going to get a lot worse because of this fire."
There is a one-year protection for homeowners in fire zones. A fire insurance company can't deny renewal to people in a high-risk fire zone or in the surrounding zip codes.
