California's Fair Plan, the state's insurer of last resort, may be unable to pay billions in claims arising from the Los Angeles fires and may require a bailout that could ultimately be paid by homeowners statewide.

A recent rule change could cause a spike in insurance premium for homeowners across California, as the costs of the Los Angeles area wildfires are passed onto them in a way that was not allowed in the past.

The devastating wildfires burning in Southern California could have financial ramifications for residents across the state.