The wildfire risk in Diann Dumas’ neighborhood is very low. And yet it’s making her bills more and more difficult to pay.

She lives in Village Green, a park-like condo complex in the middle of the busy, concrete neighborhoods of South Los Angeles. The hundreds of 1940s townhomes and bungalows encircle a manicured green space.

On the dining room table in Dumas’ one-bedroom condo is a small stack of recent homeowners association bills that pay for maintenance, landscaping and insurance. Those bills are the centerpiece of her living room, and, as of this year, the crux of her concerns.

“I just had no idea what the costs would be,” Dumas said.

Dumas remembers when she first arrived at Village Green in 1990 after she got divorced.

“I went inside and saw the center and I thought, ‘Oh my God, it’s a park in here.’ I couldn’t believe it. I had lived here all this time and didn’t know about it. And that’s what everybody says when they come.”

A one-bedroom goes for less than $600,000. A two-bedroom goes for less than $800,000. By LA standards, that’s relatively affordable.

Or rather, it used to be.

A report from S&P Global Market Intelligence says insurance rates have jumped more than 11% in 2023. It’s gone up nearly 20% since 2022. Texas, Utah and Arizona saw the worst increases last year. Meanwhile tens of thousands of State Farm policyholders in California’s high-fire-risk areas lost their insurance altogether. 

Last spring, Village Green’s insurance costs went up. Dumas’ fee went up 20% this year, from $523 per month to $628 per month.

“With my income frozen with Social Security and a pension, I have to be really careful,” she said.

The 20% increase is the maximum allowed by state law. The insurance on the property actually went up 475%. There are several possible causes, but wildfire risk isn’t one of them. So Dumas has been cutting costs wherever she can.

She downgraded to the cheapest TV package she could find. She canceled her subscription to the daily Los Angeles Times newspaper. “I thought I would never do that,” she said.

There are a a few factors that can cause insurance spikes in places like Village Green, some of which affect only condo complexes. 

One reason: Insurance companies seem to be more cautious about insuring condo complexes. Remember the Surfside condo complex in Miami that collapsed and killed 98 people three years ago? The building had a bunch of steel that corroded, and it turned into a huge claim that demonstrated the risk of insuring massive buildings.

“Insurance companies are like, ‘Oh no, if you can’t prove you’ve done all of these things, either retrofit or built to a certain standard, then it sounds pretty expensive,'” said Melanie Barker, president of the California Association of Realtors.

The second problem for condos: Insurance companies are more worried about the risks that come with a bunch of people living close to each other.

“That’s a lot of risk in just one small location. So if there is a fire, that fire is going to possibly hurt or destroy a large proportion of what you’re insuring,” said Kimberly Lilley, chair of the California Legislative Action Committee‘s Insurance Task Force.

The third problem — and this one affects condo owners and single-family homeowners alike — is climate change. California’s department of insurance says wildfires have contributed to insurance companies requesting more than $8.5 billion in rate increases since 2015.

“The definition of insurance is that we’re all in a pool together. And there’s some high risk and there’s some low risk, and that’s how the carriers can manage it,” Lilley said.

It’s similar to health insurance. Those of us who are healthy pay to subsidize those of us who have chronic conditions or got unlucky and broke a collarbone.

“When we have the benefit of that, we’re very happy. But when someone else has the benefit, we might turn around and say, ‘But wait a minute, why should I pay for them?’ And the answer is because they would pay for you,” Lilley said.

Dumas understands the idea in theory. But in practice, the insurance spike is forcing her into a bleak reality.

“It’s the first time I started thinking, well, I might not be able to afford to live here,” she said. “I’d have to move. I mean, really move. Somewhere that I don’t want to. My family’s here.”