California Homeowners Left with No Choice But to Turn to "Insurer of Last Resort"
The decisions by State Farm and Allstate to halt new homeowner policies in California demonstrate the impact of climate change on insurance options. As insurers retreat from covering California homeowners due to climate-related risks, such as wildfires, homeowners may be left with limited choices and may be forced to resort to the FAIR Plan, an insurer of last resort. However, the FAIR Plan has drawbacks, including less coverage, higher premiums, and concerns about underfunding and mismanagement, highlighting the challenges faced by homeowners in obtaining adequate insurance in high-risk areas affected by climate change.
