In California, fire insurance is often required when buying a new home.
One Paso Robles resident told KSBY News that when buying a property in Ojai earlier this year, it was a hurdle they had to jump over.
“We didn’t think we were gonna be able to purchase the property until we found out that we can get this supplemental California Fair Plan Insurance,” said Larraine Zarmati.
Those insurance policies are set to increase nearly 30%, after approval by the California Department of Insurance, in order to pay for anticipated claims and expenses.
According to the State Assembly Committee on Insurance, as of December, there are 668,609 policies on the Fair Plan. Documents show that includes 344 policies in Cambria, where the current average premium is $3,122 per year. The new average would be $3,999.
An increase that has been looming.
“They did say in the paperwork that there’s a chance that with California, prices are only going to continue to rise for the supplemental plans," Zarmati said. "I didn’t know it was going to happen so quickly.”
But not all residents are on the Fair Plan; some have bundled fire coverage through their homeowners' insurance.
“It’s pretty much stayed the same for the past ten years at least," said Richard Lambert, Cambria resident. “I think we just wrote a check for like $859 for half a year.”
KSBY News reached out to California Fair Plan Property Insurance about the rate increase. They said in part, “The largest component of the increase relates to the wildfire portion of policyholders’ premiums, so those policyholders whose properties are at significant wildfire risk will see a higher increase than those at lower risk, and some policyholders will see a premium decrease.”
They also said that policyholders may qualify for discounts by hardening their homes.
The new rates will go into effect on October 15.
