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Why Now, and Why Not Sooner?

Here’s the blunt truth: California’s insurance industry has been under siege for years as wildfires become more frequent and more devastating. Insurers like State Farm and Allstate, among others, have drastically scaled back or outright refused to renew policies in high-risk areas, citing uncontrollable wildfire exposure. Yet, these same companies continued selling other types of coverage—like auto, life, and even business insurance—to Californians, profitably raking in premiums while pulling back from the most at-risk segments of the homeowners’ market.

Commissioner Lara’s newest statement, made on January 9, 2025, appears empathetic:

“My heart goes out to my fellow Angelenos. Our top priority is protecting Californians during this crisis and helping us recover”……”I am working on all fronts to make sure wildfire victims get the benefits they are entitled to, and they get it as soon as possible.”

For those reading this who have lost their homes in the Palisades or Eaton fires, these words may bring cold comfort—especially if their insurance coverage was canceled months before the flames.

Over the past year, Governor Newsom has issued 12 emergency proclamations in response to wildfires, and widespread news reports have repeatedly warned of severe wildfire seasons. So why, then, was the moratorium not enacted earlier in 2024—or even sooner?

As a seasoned legal analyst, I’d point out that the “moratorium powers” are not new. They were established under legislation meant to protect Californians against abrupt insurance cancellations in disaster zones.

The Human Cost of Inaction

Consider the hundreds of people who lost their homes in the LA-area wildfires. Many of them had homeowners’ policies dropped, leaving them scrambling to find new coverage—or simply going uninsured. They faced a nightmare scenario: losing not just the roof over their heads but also any financial safety net to rebuild. For these residents, the moratorium may feel like too little, too late.

I spoke with a family in Topanga Canyon whose policy was canceled in the fall of 2024. They tried shopping around, but every insurer they contacted either refused to cover them or offered sky-high rates. The family, strapped for cash, opted to go without insurance. Then the Palisades Fire struck, razing their hillside property. Now, they’re left with no resources to recover.

The blame game is in full swing, and many are directing frustration at both the insurance industry and Commissioner Lara. Yes, the insurers bear significant responsibility for aggressively cutting off homeowners in high-risk zones. But the Commissioner’s office is also supposed to serve as a watchdog, stepping in when companies profit from the state’s safer markets while abandoning communities in crisis.