BIG PICTURE

State Farm baulks on wildfire risk California

Firefighters tackle a raging wildfire in a forest. State Farm, one of the largest providers of home insurance in California, has stopped writing new insurance policies in the state because of the high risk of wildfires.

A single wildfire in 2018 destroyed nearly 20,000 buildings and cost the insurance sector a reported US$18bn.

State Farm’s decision will not affect existing policyholders – although many homeowners will be left scrambling to find an alternative when their policy is due for renewal. Stories are already emerging of residents facing a 1,000%+ increase in their premiums.