Home insurance companies leaving California 2025
🔎 What’s happening: insurers are leaving or shrinking presence
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Several major insurers have stopped writing new homeowners policies in California or are non-renewing existing policies. Coverage Cat+2WBUR+2
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Some have fully exited the market — either because keeping insurance business in California is no longer profitable or because risks (wildfires, catastrophes) and regulatory pressures made continued operations untenable. HERE Beverly Hills+2Patch+2
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A number of smaller or less-common insurers (and “surplus-lines” insurers) have increased in relative importance — but these often come with tradeoffs (higher premiums, reduced regulation or consumer protections). Kiplinger+2Bankrate+2
📋 Which companies have left or restricted California coverage (as of 2024–2025)
Some of the insurers that have scaled back or pulled out include:
| Insurer / Company | What they did / Status |
|---|---|
| State Farm | Stopped accepting new homeowners/property-casualty insurance applications in CA (as of May 27, 2023). WBUR+2Wikipedia+2 |
| Allstate | Paused issuing new homeowners and condo policies in CA in 2022–2023. WBUR+1 |
| Tokio Marine Holdings (subsidiaries) | Exited the personal lines (homeowners) market — not renewing policies in CA. Los Angeles Times+1 |
| Farmers Insurance Group / its subsidiary Farmers Direct Property and Casualty Insurance Company | Limited new policies in 2023, and by late 2023/2024 its subsidiary pulled out of CA entirely for certain lines. El Estoque+1 |
| Other smaller insurers (e.g. AmGUARD, Falls Lake Insurance Company, The Hartford, American National Insurance Company) | Stopped writing new homeowners policies in California (since 2023–2024). Bankrate+1 |
Also — some of the traditional insurers who remain are writing fewer policies, tightening underwriting standards, increasing premiums, or limiting coverage in high-risk (e.g. wildfire-prone) zones. Los Angeles Times+2El Estoque+2
✅ Why insurers are leaving — the core causes
The retreat of insurers from California isn’t random. It is driven by a combination of structural factors:
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Rising catastrophe risk, especially wildfires. Recent years have brought dramatic wildfire seasons, leading to huge losses and payouts for insurers. Los Angeles Times+2WBUR+2
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Increasing costs of rebuilding and inflation. After disasters, repair and rebuild costs have skyrocketed. Combined with inflation, this has amplified insurers’ liability exposure. Coverage Cat+2Allied Schools+2
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Difficulty obtaining reinsurance (insurance for insurers) at reasonable cost, especially for high-risk zones. The reinsurance market has become more expensive, which squeezes profit margins for insurers operating in wildfire-prone areas. Kiplinger+1
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Regulatory constraints on pricing. Under state law (e.g. Proposition 103), insurers must get approval before raising premiums — a process that is slow and often lags behind real-world risk increases. This makes it harder for insurers to price policies in a way that covers rising risk. Kiplinger+2Independent Institute+2
Together, these pressures make the California home-insurance market increasingly unprofitable or risky for traditional insurers — prompting exits or retreat.
🏠 What this means for California homeowners (2025 and beyond)
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Coverage is becoming harder to find — especially in high-risk/wildfire zones. Many homeowners face non-renewals or difficulty obtaining new policies. Los Angeles Times+2WBUR+2
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Those forced to get insurance may have to settle for state-run or limited coverage options, like the California FAIR Plan (often considered a “last resort”). But this plan offers narrower coverage, often more expensive and with lower limits than standard homeowners policies. Coverage Cat+2Kiplinger+2
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Home prices, buyer demand, and real-estate transactions are affected: limited insurance availability discourages some buyers, especially in high-risk areas. Allied Schools+1
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Insurance becomes more expensive for those who can get it — both premiums and stricter underwriting or coverage limitations. El Estoque+2Coverage Cat+2
🔄 Has the trend slowed or reversed?
There are signals that some insurers may be cautiously returning or loosening restrictions — but only under specific conditions.
However, many insurers remain cautious. For homeowners in high-risk zones, coverage remains limited or expensive. Several experts warn the market is still fragile and unstable. Independent Institute+2WBUR+2
🧠 What residents/homeowners (or prospective buyers) should know now
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Start shopping early if you’re looking for homeowners insurance — don’t wait until renewal or after you buy a house. Many insurers have restricted availability or are selective about what risk profiles they’ll accept.
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Expect higher premiums, narrower coverage, or stricter underwriting (especially in wildfire-prone or high-risk areas).
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Be prepared to rely on last-resort plans (like the FAIR Plan) if traditional insurers won’t cover your home — but understand what coverage gaps exist.
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Consider reducing risk where possible (e.g. wildfire-hardening your home, defensible space, fire-safe construction/materials) — this may improve your chance of getting covered.
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Follow regulatory and market developments — insurers’ willingness to return may shift as laws change or climate-risk modeling improves.
If you like, I can put together a full list (2025) of all the major insurers that have left or severely limited home insurance in California — including small carriers and surplus-lines — with market-share estimates, so you get a sense of how big the hole is.
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