Explore California Homeowners Insurance State Guides, Laws and Regulations before You Buy Insurance
No law in California requires homeowners to insure their property. However, if you have a mortgage, the contract likely states that you must keep the property insured.
Many California homeowners choose to insure their home even if they own it outright, because homeowner’s insurance protects your financial investment from many perils, including some types of lawsuits.
The California homeowner’s insurance market has been volatile in recent years. Droughts, wildfires and economic uncertainty have played a role in this situation. In 2023, several major insurers stopped accepting new risks in California, leaving many homeowners scrambling to find new, affordable home insurance.
This article answers the most common questions we hear from homeowners shopping for insurance in CA, such as:
What is Covered by a California Homeowner’s Insurance Policy?
A homeowner’s insurance policy in California begins with fire coverage. If your home burns down, or if there is a fire that damages part of your home, it will be covered. Smoke damage is also covered.
Other Perils Covered by California Homeowner’s Insurance
A homeowner’s insurance policy in CA covers many other perils that could affect your home. These include damages from:
Air plane or vehicle crashes
Civil unrest or riot
Malicious mischief / vandalism
Broken tree limbs falling on a home
Some equipment breakdowns that could damage your home
You can read the list of covered perils on your homeowner’s insurance policy. Notably absent from the list are earthquakes and floods. If you need earthquake coverage, or if your mortgagee — the bank or lender to which you pay a mortgage — requires that you carry flood insurance, it must be added to your policy or bought separately.
How Much Home Insurance Should One Buy in California?
Every residence is different. So, insurance agents use a formula to figure the cost to rebuild a home after a covered loss, like a fire.
When getting quotes for homeowner’s insurance in California, be prepared to describe your home’s square footage, building materials, roofing and foundation. The agent will be able to tell you how much it will cost to rebuild your home.
Your mortgagee will likely require that you carry enough insurance to pay off the loan in case of a total loss. Put plainly, if you owe $250,000 for a home, the bank may require that you carry $250,000 worth of insurance. This can become a challenge in California.
The Challenge with CA Mortgages, Home Valuations and Insurance
The housing market in California, particularly in the major coastal cities like San Diego, has a reputation for being extremely expensive compared to much of the US. Homeowner’s insurance is designed to protect the homeowner from financial loss, but never covers things like the land on which a home is built, or the beautiful ocean view. This presents a unique challenge to CA insurers.
For example, a 1,000-square foot, one bedroom, one bathroom seaside cottage might sell for $3 million in California. The home buyer is paying for convenient beach access and a gorgeous view. The mortgagee wants the homeowner to carry enough funds to pay off the mortgage if the home burns down. But the actual replacement cost of this small home may be closer to $300 per square foot, or $300,000.
This is one reason insurance companies are becoming reluctant to do business in CA. They are under constant pressure to insure homes at incredibly high valuations.
Wildfire Claims Have Also Been Challenging for Homeowner’s Insurance Companies in California
California endured a decade of difficult drought, which ended in 2023. Coupled with the increasing population and new homes encroaching on wildfire-prone areas, insurers have paid tens of billions of dollars in fire claims in recent years. In 2017 alone, for instance, insurers paid $12 billion in fire losses to California home owners.
Now that you know why homeowner’s insurance companies are leaving CA or raising their rates, you’re wondering how to get the best prices on California homeowner’s insurance.
How Can I Get the Best Price on Homeowner’s Insurance in California?
The best way to get a good price on CA homeowner’s insurance is to shop around with as many insurers as possible. Some insurance companies will be reluctant to take on new risks in CA, so they’ll offer an unattractive price. Keep trying, however. You may find an insurer ready to earn your business.
If you’re struggling to find affordable homeowner’s insurance, you may need to do business with the California Fair Plan.
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What is California Fair Plan (CFP)?
The California Fair Plan is the state’s answer to insurance issues like this. In short, the state requires all major property insurance companies to take part in this program as a group. Together, they cover California’s most difficult property risks. CFP will not refuse your business (though the prices may be high depending on your neighborhood.)
CA Fair Plan policies cover most of the perils associated with a traditional home policy, like fire, lightning, smoke and so on. They do not, however, cover liability issues. In short, you may need to buy a separate, stand-alone liability policy to protect you from potential lawsuits should someone get injured on your property.
California consumers cannot contact CFP directly for a quote. You must deal with an insurance agent who has completed training, and they will sell you a Fair Plan policy.
To help you on this endeavor, we’ve supplied a list of insurers who are — at the time of writing — still doing business in CA. This list is provided by the California Department of Insurance and is subject to change.
Or, if you’d like to save time and effort, use our helpful home insurance quoting tool to find affordable home insurance in California.
Home Insurance Quotes
Get a Free Online Quote and Find Discounts for Home Insurance Now.
List of Homeowner’s Insurance Companies in CA
21st Century Premier Insurance Company3
Aegis Security Insurance Company
AIG Property Casualty Company
Affiliated FM Insurance Company
AFH Insurance Company4
American Bankers Insurance Company of Florida
American Family Connect Property and Casualty Insurance Company
American Modern Home Group
American Modern Property & Casualty Insurance Company
American National Property and Casualty Company
American Reliable Insurance Company
American Security Insurance Company
Amguard Insurance Company
Amica Mutual Insurance Company
Armed Forces Insurance Exchange
ASI Select Insurance Corporation
Aspen American Insurance Company3
Bankers Standard Insurance Company
California Automobile Insurance Company (Mercury Group)
California Capital Insurance Group
California Casualty Indemnity Exchange
California Mutual Insurance Company
Catlin Insurance Company Inc
Century-National Insurance Company
Cincinnati Insurance Company
Civil Property and Casualty Company3,5
Civil Service Employees Ins Group
Clear Blue Insurance Company
Coastal Select Insurance Company1
Constitution Insurance Company
Crestbrook Insurance Company
CSAA Fire & Casualty Insurance Company5
CSAA Insurance Exchange (AAA Northern California)
CSE Safeguard Insurance Company
DB Insurance Co., LTD (U.S. Branch)
Eagle West Insurance Company
Electric Insurance Company
Encompass Insurance Company
Exact Property and Casualty Company Inc
Falls Lake National Insurance Company
Farmers Direct Property and Casualty Insurance Company
Federal Insurance Company/Chubb
Fidelity & Deposit Company of Maryland
Fire Insurance Exchange
First National Insurance Company of America
Foremost Insurance Company Grand Rapids, Michigan
Foremost Property & Casualty Insurance Company2
Garrison Property and Casualty Insurance Company
General Insurance Company of America
Geovera Insurance Company1
Golden Bear Insurance Company
Grange Insurance Association
Hartford Insurance Group
Homesite Insurance Company of California3
Homesite Insurance Company of the Midwest
Horace Mann Insurance Companies
Horace Mann Property & Casualty Insurance Company
Hyundai Marine & Fire Insurance Company
Incline National Insurance Company
Integon National Insurance Company/National General
InterInsurance Exchange of the Automobile Club (AAA Southern CA)
Kemper Independence Insurance Company
Knightbrook Insurance Company3
Lemonade Insurance Company
Liberty Insurance Corporation
Liberty Mutual Fire Insurance Company
Mapfre Insurance Company
Markel American Insurance Company3,5
Merastar Insurance Company
Mid-Century Insurance Company
Nationwide Mutual Insurance Companies
Neighborhood Property and Casualty Company
Occidental Fire and Casualty Company of NC
Oregon Mutual Insurance Company
Pacific Indemnity Company
Pacific Specialty Insurance Company
Palomar Specialty Insurance Company1
Pharmacists Mutual Insurance Company
Praetorian Insurance Company
Property & Casualty Insurance Company
PURE (Privilege Underwriters Reciprocal Exchange)
QBE Insurance Corporation
Residence Mutual Insurance Company
Response Indemnity Insurance Company of California2
Safeco Insurance Companies
Safeco Insurance Company of Illinois
Seaview Insurance Company5
Sentinel Insurance Company
Spinnaker Insurance Company
Standard Fire Insurance Company
Standard Guaranty Insurance Company
State National Insurance Company3
Stillwater Insurance Companies
Stillwater Property and Casualty Insurance Company
Sutton National Insurance Company
Tokio Marine America Insurance Company
Travelers Commercial Insurance Company
Trumbull Insurance Company
Twin City Insurance Company
Unitrin Auto and Home Insurance Company
Unitrin Direct Property & Casualty4
Universal North America Insurance Company
USAA Casualty Insurance Company
USAA General Indemnity Company
USAA (United Services Automobile Association)
US Coastal Property and Casualty Insurance Company