Gov. Gavin Newsom (D) and the Democrat-run government of California caused insurance companies to cancel many of their fire insurance policies — with many residents of Pacific Palisades losing their policies just before the wildfires. As Breitbart News has reported for years, many insurance companies have stopped selling new policies in California “because of the increased risk of wildfires and the rising costs of construction in the state — and because the state’s regulators will not allow it to price new policies based on future anticipated risk, only on historical risk.” State Farm, the largest insurer in California, said this week that it will stop issuing new home and business policies, partly due to the risk of wildfires and the cost of construction. (Allstate quietly followed soon after.) While the left might blame climate change, the real reason is state policy. California Insurance Commissioner Ricardo Lara — who authored the state’s own “Medicare for All” proposal — won’t let insurance companies charge higher premiums for the growing risks that climate change activists say are on the way (and that skeptics blame on poor forestry). The Wall Street Journal notes that California is the only state that requires insurance companies to set premium prices based on past risks, not on future ones. The intention — to give Lara the benefit of the doubt — is a noble one. Homes are already absurdly expensive in California, as is the cost of doing business. Keeping insurance premiums down is a nice idea. But when prices are so low that they make insurance unprofitable, companies leave or collapse. That means Californians may struggle to find insurance — and, ironically, may be forced to pay more for it, as the supply of policies shrinks. That is basically how California functions: our government creates laws and regulations that theoretically aim at some inspiring social goal, but which, in practice, make that goal impossible to achieve.
California Rules Caused Insurance Companies to Cancel Policies Before Wildfires:
