{"id":8521,"date":"2024-09-16T09:54:07","date_gmt":"2024-09-16T16:54:07","guid":{"rendered":"https:\/\/jasonsblog.ddns.net\/?p=8521"},"modified":"2024-09-16T09:58:42","modified_gmt":"2024-09-16T16:58:42","slug":"california-homeowners-are-losing-their-insurance-heres-why","status":"publish","type":"post","link":"https:\/\/jasonsblog.ddns.net\/index.php\/2024\/09\/16\/california-homeowners-are-losing-their-insurance-heres-why\/","title":{"rendered":"California Homeowners Are Losing Their Insurance. Here’s Why\u2026"},"content":{"rendered":"\n

Some wonderful background on the insurance crisis in California, and how it’s leading to dramatic insurance rate increases, Having previously been a resident of California from birth, over the last decade there has been an increase in fires, and I believe being purposely set at times of high wind so they get out of control and become very large. Not only are they forcing many to move from rural lands into cities, this fits in perfectly with Agenda 2030 and getting people into smart cities, or surveillance concentration camps. For an extremely interesting analysis of Agenda 2030 by a expert witness on imminent domain, see the interview with Rosa Koire<\/a> (deceased) who discovered this vast conspiracy early on.<\/p>\n\n\n\n

https:\/\/www.zerohedge.com\/political\/california-homeowners-are-losing-their-insurance-heres-why<\/a><\/p>\n\n\n

<\/div><\/div><\/div>\n\n\n

Authored by Siyamak Khorrami via The Epoch Times<\/p>\n\n\n\n

Thousands of Californians have lost their home insurance coverage in recent years, <\/strong>a topic host Siyamak Khorrami recently featured on Epoch TV\u2019s \u201cCalifornia Insider.\u201d <\/p>\n\n\n\n

\"\"\/<\/figure>\n\n\n\n

<\/a><\/p>\n\n\n\n

To help understand the complex issue, Khorrami invited an insurance broker with 40 years in the business as well as a couple who have recently lost two homes to California wildfires, the more recent of which was uninsured. <\/p>\n\n\n\n

Additionally two California lawmakers give detail solutions and their take on how to turn the problem around.  <\/p>\n\n\n\n

Caps on Rate Increases<\/strong><\/h2>\n\n\n\n

The issue began in 1988, when California residents approved Proposition 103, which capped rate increases for auto insurance\u2014and eventually for homeowners\u2019 policies\u2014and established the state\u2019s insurance commissioner. <\/strong><\/p>\n\n\n\n

Since then, the commission has approved rate increases for residential and commercial property based on historical data and capped them at 7 percent. If a carrier requested more, the approval process was opened up to challenges by residents and watchdog groups. The result, experts say, is that increases, if approved at all, could take up to two years. <\/p>\n\n\n\n

Such kept homeowners\u2019 rates in California artificially low, while other costs for insurers were on the rise.<\/p>\n\n\n\n

A Freeze on Rate Increases<\/strong><\/h2>\n\n\n\n

Insurance broker Harry Crusberg said the crisis of so many insurance carriers canceling policies or leaving the state began during the COVID pandemic, when the state\u2019s insurance commissioner froze all rate increases, resulted in carriers losing money. <\/p>\n\n\n\n

\n

\u201cCarriers started losing $1.15 to $1.25 per dollar they took in,\u201d <\/strong>Crusberg said.<\/em><\/p>\n\n\n\n

\u201cWhen you talk about multi-millions of dollars and billions of dollars, these losses just mounted substantially for carriers.\u201d  <\/em><\/p>\n<\/blockquote>\n\n\n\n

As a result, carriers large and small started issuing nonrenewals or dropping out of the California market all together. <\/p>\n\n\n\n

\n

\u201cYou can only lose money for so long,\u201d<\/strong><\/em> he said. <\/p>\n<\/blockquote>\n\n\n\n

Suddenly, many homeowners lost their insurance and had only two options: going with one of the so-called non-admitted carriers\u2014which are not regulated or guaranteed by the state\u2014or getting insurance through California\u2019s Fair Plan, established more than 50 years ago as a last-ditch emergency resort. <\/p>\n\n\n\n

While pricing can vary, both are usually much more expensive than traditional insurance, as much as 10 times higher in some cases, experts say.<\/p>\n\n\n\n

The Fair Plan is not funded by the government, as some believe, but instead by the state\u2019s regulated insurance carriers, who pay proportionally into it. According to Crusberg, today they have accumulated about $400 billion in risk for their contributions to the plan. <\/p>\n\n\n\n

With a freeze on rate increases, contributions to the Fair Plan, the need to have their own costly insurance\u2014called \u201creinsurance\u201d\u2014and more claims for wildfire and disasters, the industry became destabilized, Crusberg said.<\/p>\n\n\n\n

\n

\u201cThey [had] to back off. They just [didn\u2019t have] the capital to sustain that,\u201d<\/strong><\/em> he said.<\/p>\n<\/blockquote>\n\n\n\n

Crusberg said the confluence of issues is rare.<\/p>\n\n\n\n

\n

\u201cI\u2019ve been in the business for a little over 40 years \u2026 and we\u2019ve never been faced with such a situation,\u201d <\/strong><\/em>he said. <\/p>\n<\/blockquote>\n\n\n\n

A New Insurance Plan<\/strong><\/h2>\n\n\n\n

According to Crusberg and others, there is now \u201clight at the end of the tunnel,\u201d thanks to recent changes by the state\u2019s insurance commission that will allow for wildfire and risk-based premiums determined by recent events. Also, under the commissioner\u2019s recent plan, an insurance carrier\u2019s requested rate increase must be decided within 90 days. <\/p>\n\n\n\n

\n

\u201cOnce that comes in, the carriers [will start] to get a breath of fresh air,\u201d he said.<\/strong><\/em><\/p>\n\n\n\n

\u201cIf we can do this and get our right rates, we\u2019re going to be able to help solve this problem by coming back into the marketplace.\u201d<\/strong><\/em><\/p>\n<\/blockquote>\n\n\n\n

But with the new plan\u2014called the \u201csustainable insurance model\u201d\u2014not yet in place, some have chosen a third option: to forgo home insurance altogether. <\/p>\n\n\n\n

One Couple\u2019s Losses<\/strong><\/h2>\n\n\n\n

Such is the case of Michael and Christy Daneau, who lost a home in the 2018 Camp Fire in Northern California\u2019s Butte County, and then, most recently, another in July\u2019s Park Fire, which originated in Chico, about a 20 minute drive west from their first home.<\/p>\n\n\n\n

The couple said they had insurance before the first fire for $86 a month. But after they moved to the Chico area, their first year of insurance through the Fair Plan\u2014the only insurer that would carry them\u2014was $7,000\u2014roughly $580 a month\u2014payable in one lump sum. <\/strong><\/p>\n\n\n\n

They also had to purchase additional coverage for their new home, as the Fair Plan offers only fire insurance. <\/p>\n\n\n\n

They said the price increased to $10,000 in the second year, again due in one payment, and finally $12,000 in the third year, which they said they could no longer afford. <\/strong><\/p>\n\n\n\n

Ultimately, the couple said, they had to go without, an especially hard decision as they had already lost one home to fire. They never expected they would be hit twice.<\/p>\n\n\n\n

The price was \u201ctoo unobtainable for us,\u201d <\/strong>Daneau said. <\/p>\n\n\n\n

Now after the Park Fire, he said they have little left. <\/p>\n\n\n\n

\u201cWe went from being homeowners, owning our house outright, to now having literally just some clothes and a few personal possessions,\u201d<\/em> Daneau said. <\/p>\n\n\n\n

Other Solutions<\/strong><\/h2>\n\n\n\n

California state Sen. Bill Dodd, who represents the state\u2019s Third Senate District including Napa, Contra Costa and Sacramento counties, told Khorrami their choice to not have insurance was not a good one. <\/p>\n\n\n\n

\u201cAll you can do is hope and pray, and hope and prayers are not a great strategy,\u201d<\/strong><\/em> he said. <\/p>\n\n\n\n

He said he has faith in the commissioner\u2019s new insurance strategy since it will allow insurers to increase rates using climate and catastrophic models and will allow them to factor in their cost for reinsurance.<\/p>\n\n\n\n

Not being able to do so previously, he said, was a \u201cdisservice to the ratepayers of the state of California.\u201d  <\/strong><\/p>\n\n\n\n

Because insurers\u2019 rate increases have been capped at 7 percent for so long, he said, allowing them to catch up with increases between 25 percent and 40 percent will ultimately stop so many carriers leaving the state. <\/p>\n\n\n\n

\n

\u201cThirty-five percent rate increases across the board are a heck of a lot better than cancellation of policies or rates that are three to four to 10 times more than [people] are paying now,\u201d Dodd said.<\/em><\/strong><\/p>\n\n\n\n

\u201cThat is at least affordable.<\/em><\/strong><\/p>\n\n\n\n

\u201cIt\u2019s doable and ultimately creates a more stable insurance market and perhaps competition over time could bring those prices down.\u201d <\/em><\/strong><\/p>\n<\/blockquote>\n\n\n\n

He said the number of policies written for the Fair Plan more than doubled over the last year, and that is \u201ca critical problem.\u201d<\/p>\n\n\n\n

\u201cIt\u2019s got way too many clients to really withstand the type of risk that it is,\u201d<\/strong><\/em> he said. <\/p>\n\n\n\n

He said as things change, property owners currently on the plan or those using non-admitted providers will decrease as more typical carriers return to the market and pick up those lost customers. <\/p>\n\n\n\n

Additionally, Sen. Dave Cortese, who represents the state\u2019s 15th Senate District, which encompasses Santa Clara County, discussed the possibility of what\u2019s known as \u201cpartial\u201d insurance, where a carrier, for example, would insure only a portion of a property, which he said needed more study. <\/p>\n\n\n\n

He added that there may be bills introduced in the next legislative session\u2014beginning in January\u2014that, if passed, would make the insurance process better for homeowners, especially in terms of fire risk, like being rewarded for hardening their property and creating defensible space around their homes. <\/p>\n\n\n\n

Then, he said, the homeowners could go back to the insurer and say, \u201c\u2018We\u2019ve reduced your risk. Can you underwrite insurance on those now?\u2019\u201d<\/strong><\/em> he said. <\/p>\n\n\n\n

He also said the Legislature needs to consider a state-funded backup financial safety net for the Fair Plan. As it is today, if there were a couple of major losses, it could become insolvent. <\/p>\n\n\n\n

By doing so, he said, \u201cFair Plan won\u2019t be able to tell [people who have catastrophic losses], \u2018Sorry, we ran out of money,\u2019\u201d <\/strong><\/em>Cortese said. <\/p>\n\n\n\n

He closed by saying both chambers of the Legislature have created their own insurance working groups to come up with solutions to get the insurance market to \u201cshift back naturally to where it should be.\u201d<\/p>\n\n\n\n

\u201cThe Legislature is taking this issue very, very seriously,\u201d he said. \u201cWe know that people who have invested their entire lives or life savings in their homes and their properties can\u2019t be left at risk without insurance coverage.\u201d <\/p>\n\n\n\n

Finding the balance between protecting property owners and ensuring insurance companies are profitable enough to do business in the state is the challenge. <\/strong><\/p>\n\n\n\n

\u201cThat\u2019s the balance and that\u2019s the trick,\u201d Cortese said. \u201cThat\u2019s what we\u2019re trying to accomplish.\u201d <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Some wonderful background on the insurance crisis in California, and how it’s leading to dramatic insurance rate increases, Having previously been a resident of California from birth, over the last decade there has been an increase in fires, and I believe being purposely set at times of high wind so they get out of control […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-8521","post","type-post","status-publish","format-standard","hentry","category-world"],"blocksy_meta":[],"featured_image_src":null,"author_info":{"display_name":"Jason","author_link":"https:\/\/jasonsblog.ddns.net\/index.php\/author\/jturning\/"},"_links":{"self":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/8521","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/comments?post=8521"}],"version-history":[{"count":2,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/8521\/revisions"}],"predecessor-version":[{"id":8523,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/posts\/8521\/revisions\/8523"}],"wp:attachment":[{"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/media?parent=8521"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/categories?post=8521"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jasonsblog.ddns.net\/index.php\/wp-json\/wp\/v2\/tags?post=8521"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}