California Fair Plan

…The L.A. fires have put a huge strain on the fair plan. The insurer recently estimated that its losses from the fires will top four billion dollars and it doesn't have enough to pay for all of that. So it's getting a bailout. Last week, state regulators agreed to let the fare plan collect a billion dollars. And that money is supposed to come from insurance…

…To offset that exposure, California regulators require that other insurance companies bail out the fare plan in the event of a large-scale disaster. Sandra and her husband didn't know about these details. All they knew was that they had to use the fare plan to insure against fire. How did the coverage compare between the fare plan and what you had with Stat…

…So a normal insurance company would try and balance its risks. It wouldn't have too much exposure in very dangerous areas. The fair plan is the opposite. It's got a ton of exposure in the worst areas. It can't really balance its risks.…