California Insurance Commissioner Ricardo Lara has requested $1 billion in additional funds from the commission's member insurers to shore up the state-backed FAIR Plan after wildfires ravaged swathes of land in and around Los Angeles last month.

The move will likely lead to higher costs for households across the state, and may push more insurers to leave, intensifying a home insurance crisis.

In the wake of the Los Angeles fires, the California FAIR Plan, the state's property insurer of last resort, requested approval for $1 billion from the California insurance commissioner, which he approved the same day. That money will be assessed from all home insurers operating in the state.

The California FAIR Plan does not have enough money to weather the impact of the record-breaking Los Angeles wildfires on its own. Instead, it will turn to private insurers for help — triggering a process where insured California homeowners across the state will end up paying part of the bill.

After saying it would run out of funds by March, California’s last-resort fire insurance provider will impose a special charge of $1 billion on homeowners and insurance companies, the first such move in more than three decades.

The funds will help the state’s insurer of last resort pay claims to thousands of homeowners affected by the wildfires.