ARNIE might want to rethink this one. In a classic case of a perverse incentive, California state law actually facilitates building homes in brushy canyons prone to massive wildfires like that which destroyed dozens of homes near Los Angeles this month.
State legislature mandates that every property owner must be able to buy affordable fire insurance, and so an industry syndicate, the California Fair Plan, serves as the insurer of last resort for property owners deemed too high-risk for conventional fire insurance. Some 17,400 owners of brushland property now obtain insurance through this route.
Offering such cover may be…
