Opinion: Even ‘high-risk’ insurance cannot protect us from societal disasters

When the Eaton and Palisades fires tore through entire stretches of Los Angeles in January, they turned a spotlight on a corner of the insurance world that typically exists in the shadows: the California FAIR Plan.

Known as the state’s insurance provider of last resort, the FAIR Plan supplies “high-risk” insurance for properties that other insurers won’t cover. In recent years, companies like State Farm and Nationwide have pulled back from California’s increasingly hazard-prone market.

As a result, the number of FAIR plan policyholders has ballooned in areas like Pacific Palisades — so much so that in the aftermath of January’s fires, the insurer careened toward insolvency before state regulators swept in with a billion-dollar bailout. Much of the cost of stabilizing the insurer will be