California's FAIR Plan, the state's insurer of last resort, is expanding beyond wildfire-prone mountains and coastal canyons into low- and moderate-risk communities, including the Inland Empire, as regulated insurers withdraw from broad areas of the market. The plan insured 696,000 properties with $788 billion in potential losses as of June 30, while Times analysis found that 9 out of 10 policies added in 396 ZIP Codes between March 2025 and the end of June 2026 were classified by the plan as low-risk. Those 11,000 homes came on top of 138,000 low-risk properties already covered. Homebuyers such as Alex Hwang and a Riverside County couple identified as Louis have resorted to surplus-lines carriers, often accepting fire deductibles of $25,000 or $14,000 and paying more for policies that lack state guarantee-fund protection. Surplus-lines carriers accounted for 7% of California's home insurance market, up from 1% in 2021, according to Weiss Ratings. The FAIR Plan provides basic fire coverage but excludes protections such as theft, liability and water damage found in conventional policies. State data show the number of traditional home insurance policies is at a 15-year low, with 1,300 ZIP Codes losing 462,000 policies since the market peaked in 2016. Insurance Commissioner Ricardo Lara said in June that the market was showing signs of stabilization, but the data indicate conventional coverage remains increasingly scarce in many developing areas. The FAIR Plan was created by the California Legislature in 1968 after the 1965 Watts riots, and its expansion has increased the potential burden on member insurers, reinsurance markets and policyholders.