FEMA mitigation program disruption adds new pressure to strained home insurance market

Availability, not just price, is increasingly the issue. Seven of the twelve largest insurers in California have limited new policies in the state since 2022. The California FAIR Plan, the state’s insurer of last resort, had 140,000 policyholders in 2018; by June 2025 that figure had grown to over 610,000. The pattern is spreading. In Louisiana, an estimated 30 to 40% of mortgage loan applications fail because of high home insurance costs, according to a 2026 analysis by the Levy Economics Institute.