This Is Who Should Foot the Bill for the Los Angeles Fires
Mr. Jones, the director of the Climate Risk Initiative at the University of California, Berkeley, was California’s insurance commissioner from 2011 through 2018.
Many Californians who’ve already lost their homeowners and business coverage because of earlier wildfires ended up in a state-created insurance program of last resort, known as the Fair Access to Insurance Requirements plan. It’s already clear that claims to the California FAIR plan from the Los Angeles fires will exceed its reserves and reinsurance. When that happens, under recent policy changes in California, all policyholders in the state will end up footing the bill through an assessment on top of their rising insurance rates.
A better model is already emerging. Several states and local governments, including California, are suing oil and gas companies to ensure that these polluters pay for the vast harm their actions have caused. The Supreme Court recently declined to take up an oil industry demand to stop one such case brought by the City and County of Honolulu from proceeding to trial. Just as lawsuits were brought against the tobacco and opioid industries, officials across the country now have a path forward to bring to trial their own claims against oil companies. More cities and states should pursue such lawsuits.
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