California Home Insurers Announce 6.9% Rate Increase: What You Need to Know

In a significant move for homeowners in California, two major insurers are set to raise their rates by an average of 6.9% this year, as revealed in recent filings with the California Department of Insurance.

CSAA is poised to initiate rate increases for approximately 481,800 homeowners starting in March. Meanwhile, Mercury Insurance plans to implement similar hikes in July, affecting over 650,000 homeowners. Both companies are collaborating with the California Department of Insurance to enhance coverage in regions particularly vulnerable to wildfires.

Related: California Bill Would Require Insurer Claims Handling Plans, and Double Penalties

The approved rate increases fall under the Sustainable Insurance Strategy, a framework designed to prevent insurers from withdrawing from the wildfire-prone areas of the state. In exchange for expedited rate filings, these carriers have committed to providing insurance in regions that have been largely avoided due to heightened wildfire risks.

In a related development, Farmers Insurance announced in late November that it will lift the cap on the number of homeowners insurance policies it offers in California. This decision comes as part of the company’s anticipation of a more favorable homeowners insurance market in the state. Previously, Farmers had limited its offerings to 9,500 new policies per month.

Related: Wildfire Victims Ask Gov. Newsom to Call for Insurance Commissioner’s Resignation

Farmers attributes the improved market conditions to the implementation of the state’s Sustainable Insurance Strategy, which aims to stabilize the insurance landscape in wildfire-affected areas.

In an effort to encourage homeowners to take proactive measures against wildfires, both Mercury and CSAA are offering discounts for those who implement protective strategies. Mercury, for instance, provides discounts that can lower wildfire premiums by as much as one-third.

Topics
California
Carriers
Homeowners
Numbers

In a significant move for homeowners in California, two major insurers are set to raise their rates by an average of 6.9% this year, as revealed in recent filings with the California Department of Insurance.

CSAA is poised to initiate rate increases for approximately 481,800 homeowners starting in March. Meanwhile, Mercury Insurance plans to implement similar hikes in July, affecting over 650,000 homeowners. Both companies are collaborating with the California Department of Insurance to enhance coverage in regions particularly vulnerable to wildfires.

Related: California Bill Would Require Insurer Claims Handling Plans, and Double Penalties

The approved rate increases fall under the Sustainable Insurance Strategy, a framework designed to prevent insurers from withdrawing from the wildfire-prone areas of the state. In exchange for expedited rate filings, these carriers have committed to providing insurance in regions that have been largely avoided due to heightened wildfire risks.

In a related development, Farmers Insurance announced in late November that it will lift the cap on the number of homeowners insurance policies it offers in California. This decision comes as part of the company’s anticipation of a more favorable homeowners insurance market in the state. Previously, Farmers had limited its offerings to 9,500 new policies per month.

Related: Wildfire Victims Ask Gov. Newsom to Call for Insurance Commissioner’s Resignation

Farmers attributes the improved market conditions to the implementation of the state’s Sustainable Insurance Strategy, which aims to stabilize the insurance landscape in wildfire-affected areas.

In an effort to encourage homeowners to take proactive measures against wildfires, both Mercury and CSAA are offering discounts for those who implement protective strategies. Mercury, for instance, provides discounts that can lower wildfire premiums by as much as one-third.

Topics
California
Carriers
Homeowners
Numbers