California's FAIR Plan rates are rising 29% in 2026 — even if you don't have a FAIR Plan policy

California's FAIR Plan — the state's insurer of last resort for homes that can't find coverage in the regular market, mostly because of wildfire risk — just got approved for a 29.1% average rate increase, effective on new and renewal policies starting October 15, 2026. That's down from the 35.8% the FAIR Plan originally requested, a California Department of Insurance (CDI) spokesperson confirmed to InsuranceNewsNet. But the number that should get more attention is this one: even if you've never had a FAIR Plan policy, part of the bill for California's wildfire-insurance crisis may already be showing up on your regular homeowners bill too.

What's actually changing

The FAIR Plan exists by statute as a backstop — coverage of last resort when no insurer in the voluntary market will write a policy on your home. It's meant to be temporary and it's meant to be small. It isn't anymore. According to the FAIR Plan's own published statistics, the program had 684,388 policies in force as of March 2026 — up 152% since September 2022, when it had roughly 270,000. Growth hasn't slowed: policy count rose another 6% in just the six months before March 2026.

That growth is why the rate increase landed where it did. The FAIR Plan asked CDI to approve a 35.8% average increase — its largest request in years — and CDI trimmed it to 29.1%. The increase is an average, not a flat number: it's weighted toward the wildfire portion of the premium, so homes in the highest fire-risk tiers see a bigger jump, lower-risk FAIR Plan properties see less, and some policyholders reportedly see a decrease.

The part that reaches beyond FAIR Plan customers

Here's the detail that gets less attention: the FAIR Plan's rate increase isn't the only wildfire-driven cost moving through California's insurance market this year. After the January 2025 Eaton and Palisades fires generated an estimated $4 billion in FAIR Plan losses, the plan levied a $1 billion assessment on its member insurers — Order 2025-1, reportedly its first member assessment in more than three decades — to cover claims after paying out $914 million to policyholders directly.

Under CDI's assessment-recoupment guidance, a member insurer that pays into that assessment can apply to recover up to 50% of what it paid by adding a temporary supplemental fee to its own policyholders' bills — calculated as a percentage of premium and collected over up to two years, per Hinshaw & Culbertson's summary of the CDI bulletins governing the process. Every property insurer licensed to write basic coverage in California is a required FAIR Plan member under Insurance Code sections 10091 and 10095, so that recoupment fee can reach almost any California homeowners policy, not just a FAIR Plan one. If you have California homeowners insurance and notice a new line-item fee on a renewal notice this year, this assessment-recoupment mechanism is the most likely explanation — ask your insurer directly whether they've filed for recoupment and what percentage of your premium it affects.

Why regulators are also rewriting the rules

Rate increases and assessments are one track; the other is a legislative rewrite of how the FAIR Plan operates. In February 2026, Insurance Commissioner Ricardo Lara and Assemblymember Lisa Calderon introduced AB 1680, the "Make It FAIR Act," according to a CDI press release. The bill followed a Department of Insurance examination that found the FAIR Plan out of compliance with 17 recommendations, and it proposes expanding FAIR Plan coverage to include standard protections like water damage and liability (currently requiring a separate policy), adding staff to speed up claims and complaints, and requiring public governance meetings, annual reports, and formal climate-risk assessments. As of this writing, AB 1680 is proposed legislation, not enacted law — it's a signal of where the FAIR Plan is headed, not a rule in effect today.

What this means if you own a home in California

• If you have a FAIR Plan policy, expect a renewal notice reflecting some version of the 29.1% average increase starting October 15, 2026 — your specific number depends on your property's wildfire-risk tier, not the average.
• If you have a regular (voluntary-market) homeowners policy, ask your insurer directly whether they've filed for FAIR Plan assessment recoupment and what fee, if any, applies to your renewal — don't assume the FAIR Plan's rate increase is someone else's problem.
• If you're shopping for coverage in a high-wildfire-risk area, the FAIR Plan's growth (152% since 2022) reflects how many California homeowners already couldn't get a voluntary-market policy — compare your options against a documented standard before assuming FAIR Plan is your only path, and see our breakdown of what a standard homeowners policy leaves out for how wildfire and other perils get handled outside California. Flood damage follows a similar last-resort pattern nationally — see our rundown of NFIP's own reauthorization deadline if you're weighing flood risk alongside wildfire risk.

ClearValue Insure doesn't sell, bind, or issue FAIR Plan or any other insurance policy — we're an educational publisher and comparison resource, not a licensed agent, broker, or carrier. For your specific FAIR Plan bill, assessment-recoupment fee, or coverage options, talk to a licensed California agent or your current carrier directly. Start with our home insurance overview or the California homeowners insurance page for state-specific context.