LOS ANGELES — Wednesday’s firestorm in a wealthy area of Los Angeles could be the final straw that breaks California’s insurance market.
The state’s insurance market has been teetering on the edge of insolvency for years thanks to catastrophic wildfires that have driven many insurers to stop writing new policies and drop existing ones. Wednesday’s wind-driven wildfires in a part of Los Angeles packed with multimillion-dollar homes could accelerate its collapse.
“It’s obviously going to be bad,” said Rep. Brad Sherman, the Democrat who represents the neighborhood between Malibu and Santa Monica where the Palisades Fire — one of six burning uncontained across the region — had destroyed more than 1,000 buildings as of Wednesday afternoon. “We’ve already seen big increases. And we’ve seen these increases not only in houses that are close to the brush, but in areas where you’re surrounded by other homes.”
President-elect Donald Trump called out the issue Wednesday as he bashed Democrats for the deadly, wind-fueled conflagrations that forced tens of thousands of people to flee their homes. “The fires in Los Angeles may go down, in dollar amount, as the worst in the History of our Country,” he wrote on Truth Social. “In many circles, they’re doubting whether insurance companies will even have enough money to pay for this catastrophe.”
