Been going on for a while, similar to Florida hurricane insurance
California insurers paid a record $15.4 billion in losses in 2017 and $13.6 billion in 2018 due to what were by far the
two most destructive wildfire seasons in state history. To put these numbers into context, annual losses never once eclipsed $5 billion prior to 2017, and have yet to exceed that amount since 2018. [1]
It was not profitable and too risky to cover.
It should be up to the residents to pay extra to live in these risky areas/the state to mitigate risks/ residents to accept the risk.