‘Don’t skimp,’ says Biden, but who’s really footing the bill as Los Angeles fire damage tops $250 billion
The wildfires in Los Angeles caused widespread destruction, with more than 40,000 acres burned, 12,300 structures destroyed and thousands displaced. AccuWeather estimates the financial impact to be between $250 billion and $275 billion and growing.
President Joe Biden recently declared, “I told the governor and local officials, don’t spare,” pledging federal support for the disaster response. With FEMA and other organizations providing emergency relief, this destruction still raises a key question: Who’s paying for it?
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As Business Insider reports, the federal government is covering the current response efforts, including fire suppression and emergency shelters. FEMA offers displaced families hazard mitigation and financial assistance, but these programs are not designed to fully rebuild homes or businesses. For this, private insurers and residents are mostly left to their own devices.
However, insurance becomes a significant obstacle. Companies like Allstate, State Farm and Farmers have recently stopped covering in high-risk areas, citing increasing risks of disasters. Many residents rely on California’s FAIR Plan, the state’s insurance program of last resort. This often results in higher premiums and less comprehensive coverage, leaving homeowners with large out-of-pocket costs.
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For uninsured residentsrebuilding is not only challenging – it is financially crippling. And while state and local governments offer some support, long-term recovery depends largely on personal finances and private contributions.
