As insurers retreat from climate-exposed markets, governments and investors are quietly abandoning the assumption that systems can return to their old equilibrium. Photo by Jeff Gritchen/MediaNews Group/Orange County Register via Getty Images In 2018, California’s insurer of last resort carried roughly 127,000 policyholders. By the end of 2025, it carried more than 668,000, with residential exposure approaching $603 billion in June 2025, a 424 percent increase since 2020.