For California, 2019 was a welcome reprieve from recent record-setting wildfire seasons. According to Cal Fire, approximately 260,000 acres burned across the state. A large area to be sure, this pales in comparison to the approximately 2,000,000 acres burned in 2018 and 1,500,000 acres in 2017.
However, state policy may lead to even worse fire seasons in the future. Despite the governor declaring a wildfire emergency last year, thereby lifting some regulatory obstacles to forest and grassland management, the state’s insurance regulator is frustrating efforts by insurers to have rates reflect real risks.
In California, insurance carriers require government permission to adjust their rates, introducing political considerations into what should be an economic decision. Unsurprisingly, rate increases aren’t popular with voters who have to pay them.
Although rates have increased, in some cases substantially, they remain capped. Consequently, the logical response for insurers is to continue offering coverage to customers…
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Utopia, you are standing in it! 
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