California’s plan that provides insurance to homeowners who can’t get private coverage needs $1 billion more to pay out claims related to the Los Angeles wildfires, the state Insurance Department said Tuesday.

The funds will help the state’s insurer of last resort pay claims to thousands of homeowners affected by the wildfires.

The move will likely lead to higher costs for households across the state, and may push more insurers to leave, intensifying a home insurance crisis.