WASHINGTON (TNND) — California homeowners who may have lost everything will already have to deal with that pain, and for some, an insurance crisis may be on the horizon.

“I don't think there's anything that I've ever seen quite like it, and the insurance companies are going to have a big problem because you're talking about big, big dollars," President-elect Donald Trump said Wednesday night at the Capitol.

Thefires are still burning, and there is already worry over California’s fragile insurance market.

Some big names including State Farm and Allstate, among others, have recently cut homeowners insurance coverage in the Golden State, a trend that's been ongoing since fires in 2017. The problem centers around intensifying climate-related events.

“So the main thing driving our our current situation with insurance is the fact that we're starting to see more severe and more frequent climate events and weather disasters in a way that we just haven't in the past," said Dr. Jeremy Porter who heads climate implications research for the nonprofit First Street Foundation, a group assessing climate risks around the country.

Porter says companies and rates haven’t kept up with increasingly catastrophic events like the California wildfires or devastating hurricanes that have recently hit places like Florida and North Carolina. It can put every policyholder, or even taxpayer, on the hook.

They're going to seek to make up that money somewhere, whether that's an overhead cost, whether it's raising rates just in high-risk areas, or whether they spread that out a little bit over their entire pool of insurance policyholders. It can impact people," said Porter.

California has a state insurer of last resort for homeowners without coverage known as the FAIR plan, and a large chunk of policyholders reside in the hard-hit Pacific Palisades area, according to Bloomberg. The plan has $458 billion worth of exposure from residents of the state who have turned to the plan.

Early damage estimates are at $10 billion or more, a number that would severely strain the already stretched system. The FAIR plan says they will be able to pay out claims. The potential problem looms if and when everyone else's rates go up as a result of covering the catastrophic damages.

California recently made tweaks to its system meant to get more private insurers back into the market by allowing them to set rates based on possible future catastrophes. It could provide more coverage but at a premium price.

There's also the FEMA element. Congress recently refilled the agency's disaster aid fund with $29 billion, and how much they may have to reallocate in the future depends on the number of disasters that impact people around the country this year.