Most Pacific Palisades residents want to go home, including the people who lived in Tahitian Terrace. In a survey 7 out of 10 say they don’t have enough money/insurance to rebuild.
Seven in 10 Pacific Palisades residents who answered the city’s post-wildfire survey say they did not have enough insurance — or any at all — when January’s wind-fueled blaze leveled their neighborhood, Los Angeles officials told an Ad Hoc Committee on Recovery June 23.
Emergency Management Department General Manager Jim Featherstone called the 70-percent figure “a signal flare,” saying inadequate coverage is now the community’s largest barrier to rebuilding. Only 554 permit applications have been filed since the Jan. 7.
Speaking during the meeting, Councilmember Traci Park said the underinsurance rate confirms what she has heard directly from fire survivors across her Westside district.
“We’re not just talking about houses,” Park said. “We’re talking about people. Families. Seniors. Teachers. First responders. People who built their lives here over decades, who paid their premiums year after year—and then found out too late their coverage wouldn’t bring them home.”
Park pointed to more than 300 fire-affected properties currently listed for sale—most, she said, owned by seniors on fixed incomes.
“This is about safety, stability, and survival,” she said. “Without adequate insurance, the path to recovery is closed. We can waive fees. We can clear debris. But if families can’t afford to rebuild, then we haven’t really recovered.”
According to a 2023 California Department of Insurance report, more than 350,000 homeowners were dropped by insurers in high-risk areas between 2015 and 2019,
After back-to-back record fire seasons, insurers began using updated risk models and satellite mapping to reevaluate coverage. Homes on hillsides, near brush, or with limited evacuation routes—like those in the Palisades—were disproportionately flagged.
Others were pushed into California’s FAIR Plan, the state’s insurer of last resort, where premiums have jumped by more than 20% in the last two years and coverage is limited.
“This is a systemic failure of oversight and regulation,” Park said. “We need meaningful state-level reform, and we need it now.”
Longtime Palisades resident and wildfire survivor Merritt Farren said the 70 percent underinsured figure, while alarming, came as no surprise to him.
Farren, who previously served as Senior Vice President and General Counsel for Disneyland and as Associate General Counsel for Digital Media and New Technologies at Amazon, said the figure points to broader systemic failures in how California regulates its insurance industry.
“It is absolutely yet another indication of how broken our insurance system is,” he said, “and how our state insurance laws and regulations instituted to date — and legal interpretations of them — have missed the mark and left Californians so unprotected.”
Farren pointed to the lack of basic consumer protections in the insurance process. “It would not have been hard to obligate insurance companies to provide consumers accurate estimates of the insurance they need when they first buy insurance,” he said, “to obligate them to update their estimates annually, and to put insurance companies on the hook for failing to do so.”
He added: “How easy would it have been, and how much pain would we have avoided, had California law required insurance companies to fully insure to full rebuild cost, adjusted up annually, absent a clear and specific election by the consumer to opt out?”
In May, Farren filed a formal petition with the California Department of Insurance to intervene in State Farm’s rate-hike proceedings, arguing the state’s regulatory framework is failing wildfire survivors.
His 28-page filing—submitted under California Insurance Code Section 1861.10—does not focus on his own claim, which he said was handled relatively well.
During Monday’s hearing, Park and city officials outlined several relief efforts already underway including a vote that day to move forward building permit waiver fees. City leaders also pointed to the CalAssist Mortgage Relief, a program that offers up to $20,000 in direct payments to servicers for residents with destroyed or uninhabitable homes and incomes below $140,700.
Featherstone said EMD will report back to the Council every six months on permit fee waiver usage. Still, Park warned that these are temporary solutions.
(Editor’s note: This story first appeared in the West Side Current and is reprinted with permission.)