As wildfires increase, insurance companies pull out...L.A. Fire Damage Protection Block

The huge wildfires that hit Los Angeles in the U.S. are expected to cause astronomical damage, but insurers have reduced insurance coverage in the region in recent years, raising concerns that recovery will not be easy.

The U.S. daily New York Times reported that major private insurers have been effectively "withdrawing" from the California area due to the cost burden of fires that have surged in recent years.

State Farm General, California's largest private insurer, said in March last year that it would not renew insurance contracts for 72,000 homes and apartments across the state.

In Palisades, which has been hit hard by wildfires, insurers have increasingly refused contracts, with 69% of "State Farm" insurance contracts canceled.

Homeowners denied by private insurers had California's "fair plan" insurance, but experts noted the state does not have the appraisers and staff to cover claims.