California's insurance market is in a state of unprecedented upheaval. As private carriers continue to pull back from writing homeowners policies in high-risk areas, more residents are being pushed toward the California FAIR Plan, the state's insurer of last resort.
Originally designed as a safety net for those who couldn't obtain coverage elsewhere, the FAIR Plan has now become the primary source of coverage for hundreds of thousands of Californians. And as the plan's size and complexity grow, so do its operational challenges.
Speaking before a California legislative committee, veteran insurance broker Karl Susman—with over 30 years in the industry—outlined three critical areas where the FAIR Plan must urgently improve to meet today's realities. He calls them the Three T's: Training, Technology, and Transparency.
These pillars, Susman argues, are essential if the FAIR Plan is to evolve from a strained emergency mechanism into a functional part of California's modern insurance ecosystem.
Before diving into solutions, it's important to understand what's happening on the ground.
California's insurance market has been battered by escalating wildfire losses, inflation-driven repair costs, and regulatory constraints that make it nearly impossible for insurers to charge actuarially sound rates. As a result, many national carriers—including State Farm, Allstate, and Farmers—have paused new business or sharply reduced their exposure in the state.
When private carriers retreat, the FAIR Plan must step in.
The number of FAIR Plan policies has more than doubled in five years, surging past 400,000. Many of these are not rural cabins in the woods—they're suburban homes, small businesses, and urban properties that once had no trouble finding standard coverage.
But the FAIR Plan was never built to serve as a major-market player. Its infrastructure, staffing, and systems were designed for limited, specialized use. Now, that mismatch is leading to delays, errors, and widespread frustration among agents and policyholders alike.
Susman's first "T" is Training, and he points out a striking reality: the number of agents writing FAIR Plan policies has ballooned to around 50,000—many of whom have never written one before.
"These are people who probably would not have written a policy in the past at all," Susman explained. "All of a sudden, they're writing FAIR Plan policies. The likelihood of them doing it correctly is pretty low or impossible without training."
Unlike private insurers, the FAIR Plan doesn't currently require certificati ...
