California Fair Plan outlines $1 billion assessment, reinsurance limits and depopulation hurdles after January wildfires

California Fair Plan officials told the California State Assembly Insurance Committee on Oct. 29, 2025, that the plan’s membership and exposure have grown rapidly in recent years, that a board-approved $1 billion assessment of member insurers was requested after Jan. 7 wildfires, and that the plan is pursuing rate changes, new funding tools and market reforms to avoid future assessments.

The hearing, an oversight briefing by Victoria Roach, president of the California Fair Plan, and Armand Feliciano, a Fair Plan representative, focused on the plan’s role as the insurer of last resort, the mechanics of the January assessment, reinsurance limits, claims handling after the Palisades and Eaton fires, and legislative and regulatory steps—such as AB 226 and the Department of Insurance’s sustainable insurance strategy—intended to restore a functioning private homeowners market (the “admitted market”).

The Fair Plan’s role and why the hearing matters

The California Fair Plan was established by the Legislature in 1968 as a residual market to provide coverage only when consumers cannot obtain insurance through admitted carriers. "We are the crutch to get them through the crisis and back into the market," said Victoria Roach, president of the California Fair Plan. Roach and Feliciano told committee members that the plan has increasingly become a first stop for consumers rather than a temporary safety net, driven by a shrinking voluntary market and by examples where Fair Plan pricing is lower than private-market alternatives in some non‑wildfire areas.

The Fair Plan reported nearly 575,000 policies and about $599 billion in exposure as of March 31, 2025. Officials said policy counts and exposure have grown sharply since 2018, with a 40% year‑over‑year increase in policies and a 60% increase in exposure reported for 2024; similar growth was tracking in the current fiscal year. That growth, Roach said, is “exponential” and concentrates risk across the state, including in areas not normally classified as high wildfire hazard.

Assessment and reinsurance: what the Fair Plan did and why

After the Jan. 7…