Five wildfires in Los Angeles have already burned more than 10,000 structures, threatening to upend California’s fragile balance between climate risk and home insurance. The Palisades Fire has damaged or destroyed more than 5,000 buildings in an area that liability experts had previously identified as one of three particularly vulnerable regions in the state.

JPMorgan Chase estimates insured damages could reach $20 billion, positioning this as likely the costliest wildfire in U.S. history. The crisis comes as California’s insurance market struggles, with seven of the 12 biggest home insurers having limited their coverage in the state over the past two years. The state-backed insurer of last resort, the California FAIR Plan, now faces exposure of up to $458 billion, while holding only $200 million in surplus cash reserves and $2.5 billion in reinsurance. Gusts of up to 100 miles per hour have fanned the flames, with more than 57,000 structures in severe danger and more than 150,000 people under evacuation.