California's home insurance market is breaking down, which is bad for homeowners, sellers, and the broader housing market.

• Insurance companies are dropping policies or leaving California entirely because wildfire claims have made the business unprofitable.
• The state's Fair Plan is becoming the only option for many homeowners, but it costs much more and covers much less than regular insurance.
• Premiums are doubling or tripling, and some buyers cannot close on homes because they cannot get coverage at all.
• Condo complexes are getting hit hard, with prices already down 30% in some developments because insurers refuse to cover whole buildings.
• The crisis is spreading beyond California to Nevada, Oregon, Washington, and hurricane and flood zones like Florida and Louisiana.

Outlook: Home values in high-risk areas will likely keep falling as insurance gets more expensive or impossible to find, especially for luxury homes and condos.