Analysis

The Depopulation Promise

In 2023, California struck a deal with insurance companies that was supposed to move homeowners off the FAIR Plan, starting with a published list of ZIP codes where the market had broken down. So far, the numbers point the other way. In 93% of those ZIP codes, more homes are on the FAIR Plan today than when the deal was announced.

By depopulatefairplan.com · Data through Mar 2026 · All figures reproducible from the datasets on Data & Downloads

The promise

In September 2023, with major insurers refusing to write new policies in California, the Newsom administration and Insurance Commissioner Ricardo Lara announced a bargain. Insurers would be allowed to charge higher rates based on catastrophe models. In return, they would have to sell policies in the hardest-hit areas at close to their normal share of the market. The state published a list of the counties and ZIP codes the deal was meant to help. A New York Times investigation later documented loopholes that weakened that commitment. We asked a simpler question: in the ZIP codes the state itself named, are fewer households on the FAIR Plan today?

1. Distressed ZIP codes, no evidence of depopulation

The state's list includes 574 ZIP codes that show up in the FAIR Plan's reporting. In 534 of them, the FAIR Plan had more policies in fiscal 2025 than when the deal was announced. 10 stayed flat. Only 30 shrank. Across all the named ZIP codes together, enrollment rose 51%, from 191,586 policies to 289,122. Even the declines deserve a closer look: the largest was in a Shasta County ZIP code that fell to zero, a pattern consistent with homes lost to fire rather than families finding private coverage.

The same holds at every scale. The list's ZIP codes cover virtually all of the 29 counties the state designated as distressed in their entirety, and in all 29 of those counties, FAIR Plan enrollment grew. These are the deal's own terms. The state chose these ZIP codes in a document whose title says exactly what the list is for: "Catastrophe Modeling and Ratemaking: Insurer Commitments to Increase Writing of Policies in High Risk Wildfire Areas". That list was last revised in March 2025 and has not been updated since. The FAIR Plan counts its own policies in these ZIP codes every quarter. Two years in, the count went up almost everywhere the promise applies.

2. Statewide, the Plan has more than doubled since the deal

The Times counted 320,581 to 625,033 through fall 2025. Five more months of quarterly reports show the line still climbing. There has not been a single quarter of decline. The shaded band shows the sixteen months it took to turn the announcement into working rules; enrollment sped up during that stretch and kept climbing after the rules took effect. And growth outside the listed ZIP codes (+157%) has outpaced growth inside them (+51%). The crisis is spreading fastest in places the list doesn't cover at all.

3. What the state did — and didn't — do along the way

Here is the record since the announcement, in one place. One pattern is worth noticing: progress is reported in insurer commitments and approved rate increases. We could find no published count of households that have actually moved off the FAIR Plan.

1. Sept 21, 2023 · Governor / CDI

   The deal is announced. Newsom signs an executive order directing regulatory action, and Lara unveils the Sustainable Insurance Strategy the same day: insurers get catastrophe-model pricing, and in exchange commit to writing at least 85% of their statewide market share in underserved areas. Stated target for finishing the rules: December 2024. [source]

2. July 2024 · CDI

   FAIR Plan Modernization order — including the 50% assessment-recoupment mechanism that lets insurers pass half of FAIR Plan assessments to policyholders.

3. Aug–Sept 2024 · CDI

   Rate-review reforms and the final phase of the wildfire catastrophe-modeling regulation — forward-looking models replace the 20-year historical average in ratemaking.

4. Nov 2024 · CDI

   Distressed-area availability regulation — the 85% test and the § 2644.4.8 distressed/undermarketed definitions take regulatory form, fourteen months after the announcement.

5. Dec 30, 2024 · CDI

   Final net-cost-of-reinsurance regulation — the last core SIS rule; insurers may pass California-specific reinsurance costs into rates if they expand high-risk coverage.

6. Jan 2025 · —

   The new system takes full effect, days before the Palisades and Eaton fires destroy roughly $30 billion in insured value and put every piece of it to the test.

7. Feb 2025 · CDI / FAIR Plan

   FAIR Plan assessed member insurers $1 billion for fire losses; under Bulletin 2025-4, insurers may seek to recoup 50% from policyholders statewide.

8. Mar 6, 2025 · CDI

   Distressed counties / undermarketed-ZIP list revised — the 663-ZIP list this analysis reconciles against. It has not been re-run since. [source]

9. May 2025 · CDI

   State Farm interim rate decision: ~17% homeowners increase approved, conditioned on a $400 million capital infusion — effective June 1, 2025.

10. June 2025 · CDI

    Claims enforcement arc begins: investigation into State Farm's fire-claims handling, a Smoke Claims Task Force, and legal action against the FAIR Plan over its own smoke-claim practices.

11. 2025 · CDI

    First rate approvals under the new system (Mercury and CSAA at 6.9%, USAA, Pacific Specialty), announced alongside planned policy counts such as Mercury's 38,000. Completed moves off the FAIR Plan are not part of the reporting.

12. Mar 2026 · CDI

    State Farm rate case settles (subject to approval): homeowners stay at +17.0%, refunds with interest for reduced classes, non-renewal moratorium extended at least a year.

13. Apr 2026 · Market

    Travelers announces a California homeowners expansion under the SIS — the first major new commitment from a top-10 carrier since the fires. The FAIR Plan, meanwhile, files for a 35.8% rate increase.

Methodology