Low-Risk California Homes Forced into High-Cost FAIR Plan

A CBS News California investigation has uncovered a troubling trend: many California homeowners in low-risk areas are being forced to rely on the state's FAIR Plan for insurance. The FAIR Plan, intended as a last resort for homes with high wildfire risk, is increasingly becoming the only option for homeowners who should qualify for standard insurance policies.

Data analysis reveals that the vast majority of FAIR Plan policyholders reside in areas classified as "low risk" by insurance companies themselves. This raises serious questions about why these homeowners are being denied traditional coverage and forced into a more expensive and often less comprehensive plan.

Julie Watts' investigation delves into the reasons behind this shift, exploring factors such as insurance companies' risk models, increasing claim costs, and regulatory challenges. She also examines whether proposed new regulations will effectively address the issue and help homeowners transition back to traditional insurance options. The FAIR plan often provides less coverage and is more expensive than standard insurance policies. Homeowners are encouraged to explore all options available to them before settling on a FAIR plan.