What if State Farm fully exits California's insurance market?
State Farm fully exiting California is a homeowners-insurance and mortgage-credit shock: license suspension freezes coastal lending and reprices property as the FAIR Plan overflows — grains are irrelevant. Rhymes with State Farm's actual 2023-24 California non-renewals and the post-2025-LA-fires FAIR Plan strain. Transmission runs through CA mortgage origination, FAIR Plan reinsurance capacity, and property-tax-backed munis; the modeled wheat/corn leg is the wrong channel.
Every number ships with its receipt — the odds, the range, the precedents, and a public grade at Reality Check. The statistical machinery that produces it is proprietary.
The butterfly cascade
How this trigger trickles across markets, left → right — the root shock, its first‑order moves, then the ripple effects. Drag any node; tap a market for its real price history.
Resolution timeline — how this probability is moving
Our model's odds (electric blue) over time vs the market's (Polymarket, amber), from the past toward the 0–6 months horizon. Each dot is a real macro event that nudged the probability — green pushed it up, red pushed it down. Tap a dot for the source. Loading the probability audit trail…
What it would mean
If this plays out, it is a risk-off shock. California regulators move to suspend State Farm's license as it fully exits the state, freezing coastal mortgage lending and repricing property. The trigger decomposes into signed root‑shocks — Credit spreads ▲ · Climate/crop supply ▲ — which propagate through our causal graph to the markets below.