State Farm Non-Renewing 72,000 California Policies

California Department of Insurance Commissioner Responds.

State Farm Insurance just announced that it will be non-renewing approximately 72,000 homeowners and apartment insurance policies this year. That is yet another big blow to the California insurance market. State Farm, Farmers, and Allstate represent close to half of the homeowners insurance policies in the state. Along with them there are at least another eight or ten lesser-known insurance carriers who are also not writing new policies or are non-renewing existing ones.

Our insurance commissioner has responded by creating a special plan designed to bring these carriers back. But my reading of this plan indicates that it’s not going to work. He is allowing carriers to model future risks better, but it comes with a requirement to write 85% of their policies in high risk areas.  This does not seem like an  incentive to me. And the fact that State Farm is continuing to pull out, proves it.

Regardless, there are some carriers in the state taking advantage of this fact, by writing what are known as Difference-in-Conditions (DIC) policies. These policies are like regular policies, except that they are designed to be accompanied by a California Fair Plan for the fire coverage.  We are very good at writing these, and write many of them each month.

If your State Farm, Farmers, or Allstate policy is being non-renewed, please call us or write to us. We will be very happy to help you find coverage until the California Department of insurance and carriers can get along and come back.

I don’t think we will  ever see the kind of pricing we have had over the past 20 years. Insurance is going to go up along with inflation.  But we also believe that competition will come again and that it will bring back reasonable pricing with it.

In the mean time, CauseWell Insurance Services is happy to help you find the best homeowners insurance plan for you.

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