California FAIR Plan continues record growth for homeowner policies
California’s backup home insurance provider hit another record number of policies before the end of last year, showing that it is still gaining users despite efforts to stem its rapid growth.
The plan, which provides fire coverage to Californians when other companies will not, reached 668,600 policies in December.
The major increase from just September 2022, when it had 271,300 policies, is largely due to traditional insurance companies reducing or restricting the number of policies they sell in California following years of catastrophic wildfires and an increased risk of more in the future.
But also contributing to the increase is price, Victoria Roach, the plan’s president, said during an Assembly Insurance Committee hearing Wednesday morning.
In many areas of the state it is substantially cheaper to buy FAIR Plan coverage, and a separate policy for non-fire related insurance, than it is to buy a more traditional homeowner policy from an insurance company, Roach said.
“So they’re coming to us because of price versus availability,” she said.
The plan was created by the Legislature in the 1960s, but is privately funded by companies that provide homeowner policies in the state. It issues coverage on behalf of those companies and insures properties no matter their wildfire risk.
“I’ve kind of reached a point where I prefer to call the FAIR Plan California’s safety net, rather than the insurer of last resort,” said Assemblymember Lisa Calderon, D-Whittier, who chairs the insurance committee.
The plan last year asked the California Department of Insurance to raise its rates by an average of 35.8% across its policyholders. That request is pending. Roach said getting department approval for higher rates will help slow down the number of people turning to the plan.
The department has tried to incentivize companies to write more policies in wildfire-distressed areas, and legislators have also required the plan to create a policyholder clearinghouse as ways to reduce the policy count. So far, those efforts have not led to a decrease.
Roach said the plan, while growing quickly, is not increasing its policy numbers at the rate it was last year in large part because traditional insurance companies this year have not yet dropped as many customers in bulk. The average length of time a policyholder stays on the plan is about seven or eight years, she said, but some have used it for 30.
“How do we get back to being the insurer of last resort?” Roach asked committee members. “And can we get back to being the insurer of last resort? I think that’s really the open question.”
This story was originally published January 28, 2026 at 10:55 AM with the headline "California FAIR Plan continues record growth for homeowner policies."
