By Oakview Insurance Services | Yuba City, CA | Home Insurance
If you are currently insured through the California FAIR Plan, your premium is going up. The California Department of Insurance approved a 29.1% average rate increase statewide, effective October 15, 2026.
That number has gotten a lot of attention in the news. What has not gotten enough attention is what it actually means for homeowners in higher wildfire risk zones. The 29.1% is a statewide average. For policyholders with significant wildfire exposure, the increase to that portion of their premium could be far higher. Some will see their wildfire premiums double.
Here is what is driving the increase, what you can do to reduce your bill, and whether there are better options available to you before October 15 arrives.
Why the CA FAIR Plan Is Raising Rates
The FAIR Plan was built as a last resort, not a long-term insurance market. It provides basic fire coverage to homeowners who cannot find policies through private carriers. But between the fall of 2024 and the end of 2025, the number of active FAIR Plan policies grew by 44%, reaching more than 668,600 statewide. That growth was not organic. It happened because major carriers pulled back from wildfire-prone areas across California, leaving homeowners with nowhere else to go.
Then came January 2025. The Los Angeles wildfires generated an estimated $4 billion in losses for the FAIR Plan alone, forcing the plan to assess its member insurance companies $1 billion just to cover claims. That is the financial reality behind this rate increase.
The FAIR Plan initially asked for 35.8%, which would have been its largest rate increase ever. The CDI approved 29.1%. That is still the largest approved increase the plan has seen in recent history, topping the roughly 20% increase in 2019 and the approximately 16% increases in both 2021 and 2023.
29.1% Is the Average. Your Number May Be Higher.
Your actual increase depends on your property, its location, its wildfire risk score, and what perils your policy covers. Homeowners in lower-risk areas may come in below the average. Homeowners in higher-risk fire zones, which includes significant portions of the foothills and rural corridors across Butte, Yuba, and Colusa Counties, are likely to land at or above it.
For those carrying policies with heavy wildfire-peril exposure, the increase to that specific line item could be far more dramatic than 29.1%. Some policyholders will see that portion of their bill double.
You do not need to do anything for the increase to take effect. If your renewal falls on or after October 15, the new rates apply automatically.
What the FAIR Plan Covers and What It Does Not
A standard FAIR Plan dwelling policy covers fire and a limited set of basic perils. It does not include liability protection, theft coverage, or most of the protections that come with a traditional homeowners policy. Most homeowners on the FAIR Plan are also carrying a Difference in Conditions policy alongside it to fill those gaps.
If you are not carrying a DIC policy, that needs to be addressed regardless of the rate increase. A FAIR Plan policy alone leaves real exposure on the table.
The FAIR Plan itself describes its role as a temporary safety net. Its stated goal is attrition: to support homeowners until a traditional carrier becomes available again. It was never designed to be a permanent home for hundreds of thousands of California families.
Discounts Available to FAIR Plan Policyholders Right Now
The FAIR Plan updated its wildfire hardening discount program effective November 15, 2025. Policyholders can now qualify for up to 12 individual discounts, all applied to the wildfire portion of the premium. Dwelling Fire policyholders who qualify for all 12 may see savings of up to 16.4% off that portion of their bill. For Commercial policyholders the maximum is up to 13.8%.
The discounts are organized into four categories:
Immediate Surroundings (5 separate discounts)
- Vegetation and debris cleared from under decks
- Vegetation, debris, mulch, and combustible materials cleared within 5 feet of the dwelling
- Only noncombustible materials used in any improvements within 5 feet of the dwelling, including fences and gates
- Combustible sheds and outbuildings more than 30 feet from the dwelling, or as far as possible within the area under the applicant’s control
- Trees trimmed, brush and debris removed, and property in compliance with defensible space requirements under California Public Resources Code Section 4291
Structure (5 separate discounts)
- Class-A Fire Rated Roof (asphalt fiberglass composition shingles, stone, concrete or clay tile, or metal)
- Enclosed eaves
- Ember and fire-resistant vents with approved wire mesh covering
- Upgraded windows (multi-paned) or functional shutters
- 6 inches at the bottom of all exterior walls made of non-combustible material
Property Level Completion Discount (1 discount)
If your property meets all 10 of the Immediate Surroundings and Structure criteria above, you qualify for one additional completion discount on top of the individual 10.
Community Discount (1 discount)
Based on your property’s location, not individual improvements. Meeting either of the following qualifies. Meeting both earns a larger percentage:
- Property is located in a Fire Risk Reduction Community listed by the California Board of Forestry
- Property is located in a Firewise USA Site in Good Standing
Each discount requires documentation and verification. They do not apply automatically. If you have completed any of these improvements, contact your broker before your next renewal to make sure they are reflected in your policy. For the full breakdown of qualifying criteria, see our California FAIR Plan Wildfire Hardening Discounts guide.
The Private Market Is Starting to Move Again
The private insurance market in California has not fully recovered. But it is not standing still either. Some carriers have been quietly re-entering specific markets as the state’s new pricing regulations take effect, and that shift matters for FAIR Plan policyholders who assumed they had no other options.
Mercury Insurance is one carrier worth knowing about. Mercury has been expanding homeowners coverage in wildfire-prone California areas as part of the state’s Sustainable Insurance Strategy, and the company is actively positioning itself as a private market alternative to the FAIR Plan for eligible homeowners. Their wildfire mitigation discount structure is more detailed than anything the FAIR Plan offers:
- Standard mitigation efforts: roughly 12.5% to 22.5% off the wildfire-peril portion of the premium
- Advanced home hardening: roughly 25% to 45%
- IBHS Wildfire Prepared Home certification: 22.5% to 37.5%
- IBHS Wildfire Prepared Home Plus certification: 30% to 50%
- Certain fire-resistive construction types: up to 60%
These discounts apply to the wildfire-peril portion of the policy, not the entire premium. Eligibility is subject to underwriting review and Mercury may request photos or documentation to verify mitigation work. But for homeowners who have put real money into fire resilience, the savings can be substantial, and the coverage is far broader than what the FAIR Plan provides.
Mercury also factors in community-level mitigation. Neighborhood participation in Firewise USA, local fuel reduction programs, and broader community resilience efforts can improve your insurability even if your individual property changes are modest.
Other Carriers Worth Asking About
Mercury is not the only option. Depending on your property’s location, construction type, and mitigation history, other carriers have been writing or re-entering certain California markets. At Oakview Insurance, we have been able to move some FAIR Plan clients into private coverage through carriers including CIG, SageSure, Orion180, and Solara, among others.
Whether any of these work for your property depends entirely on the specifics. There is no blanket answer. But there is also no reason to assume the FAIR Plan is your only choice without checking.
What to Do Before October 15
The rate increase is coming regardless. But how much you pay and whether you stay on the FAIR Plan at all are questions worth answering now rather than at renewal.
- Pull out your current FAIR Plan policy and note your coverage limits, your current premium, and whether you are carrying a Difference in Conditions policy alongside it
- Review the discount criteria above and gather documentation for any improvements you have already made
- Ask an independent broker to check the private market for your specific property and zip code
- If you have made home improvements since your last renewal, make sure those are documented and factored into your current coverage
The market has changed more in the last 12 months than in the three years before that. It is worth a fresh look.
How Oakview Insurance Can Help
We work with homeowners across Yuba, Sutter, Colusa, and Butte Counties on exactly these questions every day. We are licensed to write CA FAIR Plan policies and we have access to over 100 carriers, which means when we look at your situation, we are shopping the full market, not steering you toward the one product we happen to carry.
If your renewal is coming up before October 15, or if you just want to understand what this increase means for your specific household, visit our CA FAIR Plan insurance page to learn more about how we work, or call us directly at (530) 674-5054. There is no cost to having someone look at your situation before the bill arrives.