Malibu Residents Increasingly Rely on Pricey Insurance as Wildfire Rages
So-called non-admitted policies are helping fill home insurance gaps. But they come at a steep cost only the wealthy can likely afford.
Firefighters monitor the Franklin Fire, which is burning largely uncontained through Malibu, California.
Photographer: Kyle Grillot/BloombergEven before the Franklin Fire grew to more than 4,000 acres and compelled famous residents like Cher and Dick Van Dyke to evacuate, Malibu faced a severe home insurance crisis, exacerbated by California’s rising wildfire risk.
Coverage was getting harder to find, prices were rising and more homeowners were turning to a less-regulated form of insurance known as “non-admitted” or “surplus.” The average surplus premium to protect property this year was roughly $46,000 in the wealthy enclave, where real estate can run into the tens of millions of dollars. The situation is only likely to worsen as climate change ups the odds of destructive wildfires.