The Next Financial Crisis: Insurance

The Los Angeles fires are straining the insurance industry, especially the FAIR Plan, which lacks sufficient funds for the projected $20 billion to $50 billion in losses. Insurers are increasing rates or leaving the market, pressuring the state to manage uninsured losses. There's a mismatch between insurance costs and risks, with cheaper premiums in high-risk areas. Unregulated insurers are raising concerns about financial stability.