UPDATE
Jun 2, 2023 2:30 AM CDT
Another big insurance company has quietly stopped selling home insurance in California. Allstate, which in 2021 was the fourth-largest property and casualty insurance provider in the state, is no longer writing new homeowner, condo, or commercial insurance policies there, the San Francisco Chronicle reports. The company says the pause on new policies, which started last year but went largely unnoticed until now, aims to ensure "we can continue to protect current customers." At least two other insurers, AIG and Chubb, have also pulled some policies in the state in recent years, but consumer advocates say there are more than 100 insurers who continue to do business in California.
May 28, 2023 3:35 PM CDT
State Farm Insurance has announced that it's no longer there for Californians looking to insure their home. Mostly blaming wildfires and rising construction costs, the company quit selling new policies this weekend. Applications for business coverage will no longer be accepted, either, the Wall Street Journal reports, but existing home and business policies will remain in effect. Personal auto policies will still be sold in the state. Insurers in California and elsewhere have attributed underwriting losses to inflation recently while asking for regulatory approval of rate increases to cover the gap.
The insurer recognized California government agencies "for their wildfire loss mitigation efforts," a statement said, per the Hill. "However, it's necessary to take these actions now to improve the company’s financial strength." California's official count for 2022 was 7,490 wildfires and more than 360,000 acres burned, which Cal Fire called a "quiet year." As a mutual company, State Farm is owned by its policyholders; its net worth at the end of last year was $131.2 billion. California's mitigation efforts are "really going after the root causes of the insurance issues," a state insurance official said, "which is the wildfire risk." (More California stories.)
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