It is arguably getting pretty hard to figure out which news articles are true and which not (if it wasn’t filed under The Onion. I guess that is probably not a good sign.

Would this not most likely still cause the same kind of financial collapse in the housing market that was mentioned as a possibility in the article linked by OP? If it is not possible to get insurance for an event (i.e. wildfire) that is likely(/definitely going) to occur, then I imagine buyers/real-estate developers would be less inclined to pay high prices in those regions.