Californians are at risk of losing even more: The Los Angeles area blazes that have killed at least five people and destroyed or damaged more than 2,000 buildings this week are threatening to raze more neighborhoods than insurance providers can handle.

The latest. Nearly 200,000 people across 45 square miles have been forced to evacuate:

• With the two main fires in the Pacific Palisades and Altadena still 0% contained as of Thursday, JPMorgan doubled its prediction for the disaster’s total economic losses to $50 billion yesterday.
• Insured losses could surpass $20 billion, per JPMorgan, which would make it the costliest wildfire in US history. (The biggest wildfire in the US before now, the 2018 Camp Fire, incurred $12.5 billion in insured damages.)

This is what the insurance industry has been dodging. State Farm, Allstate, and other major insurers stopped selling new home policies in the Golden State in recent years, citing the growing risks of wildfires. That’s led tens of thousands of Californians to sign up for the FAIR plan, the state’s limited fire insurance program—or go without insurance altogether.

• Last year, State Farm didn’t renew policies for 72,000 homes and apartments, including 69% of the insured homes in the now-flattened Palisades.
• With private insurers pulling out, FAIR plan coverage for Palisades residents spiked 85% from September 2023 to September 2024—more than double the statewide increase over the same period, according to the Wall Street Journal.
• The FAIR plan—which was intended as a last resort for the uninsured—could be on the hook for $5.9 billion in Palisades coverage.

“We are watching very nervously,” said Amy Bach, the executive director of the consumer advocacy group United Policyholders. Insurance providers rely on reinsurance—which is like insurance for insurers—to help them pay out catastrophes. FAIR only has $2.5 billion in reinsurance, so policyholders could be facing a bumpy road to reimbursement…and higher premiums.—ML

Jimmy Carter was laid to rest. All five living US presidents—Biden, Trump, Obama, Bush, and Clinton—were in attendance yesterday as Carter was remembered at the Washington National Cathedral before his coffin was flown to his hometown of Plains, Georgia, for a final private service and burial. Carter, who was president from 1977 to 1981, was celebrated for his humanitarian work and commitment to peace. “Today, many think he was from a bygone era,” Biden said during a eulogy. “But in reality, he saw well into the future.” Social media was abuzz after Presidents Obama and Trump were seen chatting for several minutes before the ceremony.

Musk lowered expectations for DOGE cuts. The billionaire co-head of the Department of Government Efficiency—a new advisory body meant to help President-elect Trump make cuts to the federal budget—has made his first cut: his own goals. In an interview, Musk admitted that cutting $2 trillion, as he originally planned, is unlikely, capitulating to the chorus of budget experts who have pointed out that the US government’s entire discretionary budget is only $1.7 trillion. Instead, Musk said he thinks there’s a “good shot” at cutting half of his initial $2 trillion goal. Per experts, DOGE would probably have to recommend cuts to popular programs like Medicaid to hit his target.

JCPenney is merging with the owner of Forever 21 and Aéropostale. In news that would make your 2002 brain explode, the once-mighty department store chain is joining forces with Sparc Group—which also operates Eddie Bauer, Nautica, and Brooks Brothers—to form a blob of mall brands. The new company will be called Catalyst Brands and plans to launch with 1,800 stores and 60,000 employees. After filing for bankruptcy at the height of the pandemic, JCPenney was bought by real estate companies Simon Property and Brookfield for $1.75 billion. One analyst told CNN that the strategy behind the venture is to consolidate struggling brands “with the aim of creating something greater than the sum of the parts.”—AE

Like Severance Season 2 and Leonardo DiCaprio’s 2016 Oscar win, the TikTok ban has been a highly anticipated event for what feels like an eternity. Today, the issue finally reaches the Supreme Court, where justices will hear oral arguments.

Both the US government and TikTok will invoke treasured American ideals in their arguments to sway the court, which will need to act quickly to make a decision before the ban’s deadline of Jan. 19. Expect to see national security versus free speech:

• The US says TikTok’s current operation under Chinese ownership is a matter of national security, maintaining that Beijing could use app data to spy on citizens and spread anti-US propaganda.
• TikTok says the sell-or-be-banned law violates the First Amendment and that concerns about the app’s potential use as a Chinese propaganda agent have no weight.

The precedents are mixed. SCOTUS has previously sided with the government over national security concerns…but it also tends to uphold the right to free speech. The last time it had to pick between them was in 2010, when it sided with the government to uphold a law criminalizing assistance to alleged terrorist groups.

Meanwhile…billionaire Frank McCourt’s nonprofit, Project Liberty, made a proposal to buy TikTok from ByteDance yesterday, calling it “The People’s Bid for TikTok” and pledging to prioritize digital safety on a US-owned version of the app.—CC

Kohler, watch your back(side). Japanese toilet- and bidet toilet seat-maker Toto is setting its sights on conquering the American market, promising to triple its showrooms in the US from 100 to 300 across 63 cities by the end of next year, the company’s CEO said in an interview with Nikkei Asia.

Toto brought the bidet to the masses in Japan in 1980 when it created the washlet, a bidet toilet seat attachment. The company boasts 60 million washlets (currently $350 a pop) in use worldwide and a range of high-tech smart toilets that cost anywhere from $6,000 to over $22,000.

Already widespread in Japan and other Asian markets, Toto toilets use less water and offer features your boring dumb toilet could only dream of: flushing systems that blast off streaks on the bowl, oscillating bidet streams, and memory settings for users.

Big picture: Toto has backed off growth efforts in China after years of falling sales, which it attributes to a slowing real estate market. The company thinks it can instead tap the US market and ride the pandemic wave of bidet obsession.—MM

It turns out that you can avoid most of the awkwardness of asking a vague acquaintance for a job referral if you just hit up a total stranger instead. Bloomberg reported on the growing underground market of apps and websites that connect job hunters with anonymous employees willing to do them a solid in the hopes of securing a referral bonus. One tech worker told the outlet that he made $30,000 after submitting more than 1,000 referrals for randos.

Win-win, right? Maybe not for long. While referral platforms, like Refermarket and ReferralHub, say the practice is kosher, some companies are starting to catch on, saying that not only does it violate their code of conduct, but it’s also forced them to ignore referrals from certain employees known to game the system. Which means job seekers using an anonymous referral might end up being penalized in their attempt to get the inside track. You can’t blame them for trying, though: Referrals have a 1 in 25 chance of being hired vs. a 1 in 200 chance for external applicants, per Greenhouse.—AE

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