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Written by Natalie Todoroff
Edited by Jessa Claeys
Reviewed by Mark Friedlander
Edited by Jessa Claeys
Reviewed by Mark Friedlander
Updated Sep 01, 2024
Based on Bankrate’s research, USAA, Chubb, Nationwide, Travelers and Encompass offer Californians some of the best home insurance policies in the state.
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California is a risk-prone state, so it may be surprising to learn that its average home insurance rate is $1,456 per year for $300,000 in dwelling coverage, which is 14 percent lower than the national average of $2,285 per year for the same amount of coverage. Even so, homeowners in California have special considerations to take into account when shopping for home insurance, like the state’s shrinking home insurance market, wildfires and earthquake coverage.
Bankrate’s insurance editorial team, which includes licensed insurance agents and industry professionals, can help you understand how to find proper insurance coverage in the Golden State. We assessed California home insurance companies’ average rates, coverage options, discount opportunities, third-party ratings and digital tools to find the options that stand out.
According to Bankrate’s research, the best homeowners insurance companies in California include:
- Best for military-focused coverage: USAA
- Best for high-value homes: Chubb
- Best for unique coverage options: Nationwide
- Best for green homes: Travelers
- Best for bundling with auto insurance: Encompass
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On This Page
On This Page
- Compare the best home insurance companies in California for 2024
- Best California homeowners insurance companies in detail
- Additional California home insurance companies to consider
- Cheapest home insurance companies in California
- Best home insurance discounts in California
- How much is home insurance in California?
- What does home insurance cover in California?
- Additional home insurance coverage types in California
- Frequently asked questions
- Methodology
Compare the best homeowners insurance companies in California
Finding California home insurance can be difficult. A recent report from the California Association of Realtors found that, in 2023, almost 7 percent of real estate transactions in the state fell out of escrow because potential homeowners couldn’t find affordable insurance. Of that group, more than 61 percent claimed that they couldn’t find an insurer willing to write them a policy.
According to our research, USAA, Chubb, Nationwide, Travelers and Encompass are some of the best California homeowners insurance companies. Keep in mind, however, that there’s no guarantee these companies will agree to insure your home. To note, USAA, Nationwide, Travelers and Chubb are still actively writing policies in California but have scaled back the number of available policies.
Insurance company | J.D. Power | Average monthly premium | Average annual premium | |
---|---|---|---|---|
USAA | 881 /1,000 | $66 | $793 | |
Chubb | 801 /1,000 | $185 | $2,220 | |
Nationwide | 812 /1,000 | $113 | $1,358 | |
Travelers | 790 /1,000 | N/A | N/A | |
Encompass | Not rated | $264 | $3,174 |
We have confirmed that these carriers are currently writing homeowners insurance policies in California. However, coverage may be limited to certain areas of the state or homes with certain damage-mitigation features.
Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.
Rates refreshed as of Sep 2024
Read our full methodology
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Bankrate's trusted insurance industry expertise
The home insurance market can be complicated, but Bankrate's insurance editorial team used our unique perspective to bring readers information they need to make educated decisions when shopping for home insurance.
46
years of industry expertise
122
carriers reviewed
34.5K
ZIP codes examined
1.2M
quotes analyzed
The top 5 home insurance companies in California
Best for military-focused coverage
4.7
4.7
Rating: 4.7 stars out of 5 Bankrate scores primarily reflect a weighted rank of industry standard ratings for financial strength and customer experience, in addition to average quoted rates. A secondary assessment of each provider's online and mobile resources and policy management options also contributed to overall ratings. Bankrate Score
USAA ReviewGet a personalized quote
Avg. premium for $300K dwelling
$66/mo
Avg. premium for $300K dwelling
$793/yr
Customer satisfaction
881/1,000
Why USAA made our list: Although its eligibility restrictions preclude it from official ranking, USAA earned the highest J.D. Power score for customer satisfaction in addition to tying for Best Home Insurance Company Overall in the 2024 Bankrate Awards. For those eligible to become USAA members, the company is often one of the most affordable California homeowners insurance companies. It also has unique options beneficial to active-duty military members, like coverage for uniforms damaged in a covered loss.
Who USAA may be good for: If you are affiliated with the military or a qualifying family member, USAA could be a good choice. The company offers low average rates and coverage options tailored to military families.
Pros
- Low average rates
- High J.D. Power customer satisfaction score
- Coverage options for military families
Cons
- Strict eligibility requirements
- No in-person insurance locations
- Does not write earthquake insurance in California
USAA’s home insurance policies come standard with $5,000 of identity theft protection andreplacement cost coverage. To further build out your policy, you can add the following endorsem*nts:
- Home protector: Raises your dwelling and other structures limits by 25 percent if a covered loss exceeds your policy limits. Exclusions may apply.
- Personal injury: Covers qualifying expenses related to libel, slander or defamation of character lawsuits against you.
- Water backup: Also known as sewer backup coverage, this add-on can help with the cleanup and repair expenses that stem from water that backs up and overflows from your home’s plumbing system.
- Electronics coverage: Extended coverage limits for pricey tech items like TVs, gaming systems, mobile phones, computers and even wearable tech.
California city
USAA avg. annual premium for $300K dwelling
Los Angeles
USAA avg. annual premium for $300K dwelling
$760
Anaheim
USAA avg. annual premium for $300K dwelling
$755
Riverside
USAA avg. annual premium for $300K dwelling
$812
Oakland
USAA avg. annual premium for $300K dwelling
$686
Long Beach
USAA avg. annual premium for $300K dwelling
$675
Best for high-value homes
4.3
4.3
Rating: 4.3 stars out of 5 Bankrate scores primarily reflect a weighted rank of industry standard ratings for financial strength and customer experience, in addition to average quoted rates. A secondary assessment of each provider's online and mobile resources and policy management options also contributed to overall ratings. Bankrate Score
Chubb ReviewGet a personalized quote
Avg. premium for $300K dwelling
$185/mo
Avg. premium for $300K dwelling
$2,220/yr
Customer satisfaction
801/1,000
Why Chubb made our list: Chubb's product line is geared more towards high-net-worth individuals, earning it our 2024 Bankrate Award for Best for High-Value Homes. However, eligibility may be restricted based on home value, so Chubb may not be an option for all homeowners. One key offering that may appeal to California homeowners is the company's Wildfire Defense Services, which works year-round to monitor, prevent and mitigate losses to your home and valuables from wildfire.
Who Chubb may be good for:Chubb may be a good choice for high-value homes needing specialty earthquake or flood coverage since Chubb offers both options for eligible homes. Specializing in custom policy coverage, homeowners with wine, jewelry and art collections may be interested in Chubb's tailored coverage and HomeScan risk-mitigation consulting.
Pros
- Unique Wildfire Defense Services may appeal to homeowners in fire-prone regions
- Offers flood, earthquake, wildfire, hurricane and hail coverage in many states
- Unique endorsem*nt selection and additional policies, such as home equipment breakdown coverage
Cons
- Higher average rates than many other carriers
- Eligibility may be restricted based on home value
- Scored below average in the J.D. Power 2023 U.S. Home Insurance Study
Because Chubb’s Masterpiece plan already includes such a wide breadth of coverage, its add-ons are more limited. The Masterpiece policy includes extended replacement cost coverage, water backup coverage, replacement value for your personal property, identity theft coverage and other coverages that are typically only offered as endorsem*nts from other insurers.
That said, California homeowners interested in a Chubb policy may also want to know about its other home-related insurance lines:
- Equipment breakdown coverage: Chubb offers clients two different tiers ofequipment breakdown coverage, Essential and Enhanced. The Essential tier has a $250,000 limit and can cover HVAC systems, appliances, water heaters, swimming pool equipment, well pumps, permanent generators and permanent home security systems. The Enhanced tier has a higher coverage limit of $500,000, and when paired with the Masterpiece Contents plan, can cover the same items as the Essential tier in addition to computers, humidifiers and countertop appliances.
- Valuable articles insurance: If you have something expensive in your home, whether it’s a vintage wine collection or a prized baseball card collection, Chubb can probably insure it. Chubb offers separate endorsem*nts for jewelry, wine and spirits, fine art and personal collections.
California city
Chubb avg. annual premium for $300K dwelling
Los Angeles
Chubb avg. annual premium for $300K dwelling
$3,083
Anaheim
Chubb avg. annual premium for $300K dwelling
$2,618
Riverside
Chubb avg. annual premium for $300K dwelling
$2,485
Oakland
Chubb avg. annual premium for $300K dwelling
$1,988
Long Beach
Chubb avg. annual premium for $300K dwelling
$2,316
Best for unique coverage options
4.3
4.3
Rating: 4.3 stars out of 5 Bankrate scores primarily reflect a weighted rank of industry standard ratings for financial strength and customer experience, in addition to average quoted rates. A secondary assessment of each provider's online and mobile resources and policy management options also contributed to overall ratings. Bankrate Score
Nationwide ReviewGet a personalized quote
Avg. premium for $300K dwelling
$113/mo
Avg. premium for $300K dwelling
$1,358/yr
Customer satisfaction
812/1,000
Why Nationwide made our list: Nationwide offers several endorsem*nts, including the unique Better Roof Replacement option, water backup coverage and identity theft protection. Additionally, the company may help California homeowners obtain flood and earthquake insurance. The company also offers a wide selection of home insurance discounts, which helped it win the 2024 Bankrate Award for Best Budget Home Insurance Company. However, Nationwide does have a lower-than-average J.D. Power customer satisfaction score.
Who Nationwide may be good for: Shoppers looking for unique coverage may want to consider Nationwide. The company’s Better Roof Replacement option and ability to help homeowners obtain separate policies like flood coverage could help round out your insurance portfolio.
Pros
- Offers several endorsem*nts
- Numerous discounts available
- Local agents available
Cons
- Below-average J.D. Power customer satisfaction score
- Customer service is not 24/7
Nationwide’s home insurance policies already include credit card coverage and ordinance law coverage, which helps with the added costs of getting your home up to code following a covered loss. You can expand the scope of your home insurance coverage with these endorsem*nts:
- Brand New Belongings: This is Nationwide’s version of replacement cost coverage for your personal property. If your belongings are damaged in a covered claim, Nationwide can pay youactual cash value. After you replace or repair your items, Nationwide can reimburse you for the added cost.
- Valuables Plus: An extra layer of higher-limit coverage for expensive items.
- Identify theft coverage: Can reimburse up to $25,000 of out-of-pocket expenses related to identity theft and set you up with an identity theft specialist.
- Service line coverage: Covers costs related to repairing underground service lines like gas, electricity and water. This can include excavation costs, additional living costs, repairs and other related expenses.
California city
Nationwide avg. annual premium for $300K dwelling
Los Angeles
Nationwide avg. annual premium for $300K dwelling
$1,855
Anaheim
Nationwide avg. annual premium for $300K dwelling
$1,321
Riverside
Nationwide avg. annual premium for $300K dwelling
$1,418
Oakland
Nationwide avg. annual premium for $300K dwelling
$1,451
Long Beach
Nationwide avg. annual premium for $300K dwelling
$1,495
Best for green homes
4.1
4.1
Rating: 4.1 stars out of 5 Bankrate scores primarily reflect a weighted rank of industry standard ratings for financial strength and customer experience, in addition to average quoted rates. A secondary assessment of each provider's online and mobile resources and policy management options also contributed to overall ratings. Bankrate Score
Travelers ReviewGet a personalized quote
Avg. premium for $300K dwelling
Not available
Avg. premium for $300K dwelling
Not available
Customer satisfaction
790/1,000
Why Travelers made our list: Travelers standard home insurance policies are on the simpler side, but the insurer offers policyholders multiple ways to customize with a healthy list of insurance endorsem*nts like water backup coverage, identity theft coverage and higher limits for valuables like jewelry and silverware. Although these add-ons will likely increase your premium, there are a nice handful of discounts available to help you save. These include a multi-policy discount, a claims-free discount, a discount for a newly purchased home and one for homes with protective devices like smoke detectors and home security systems.
Who Travelers may be good for: It’s no secret that California is pushing forgreener homes. If you’re ahead of the game and already live in a Leadership Energy and Environmental Design (LEED) certified home, you could save up to 5 percent on your Travelers home insurance premium. Travelers also offers specialized green home coverage, which can help shoulder the added costs of repairing or replacing your home with green materials following a covered loss.
Pros
- Special discount and coverage for green homes
- Customizable policies
- Local agents available
Cons
- Ranked third-to-last in the 2023 J.D. Power Home Insurance Study
- Online quotes not available in California
Travelers’ list of additional coverage options is not the longest compared to some other providers, but it’s also not the shortest. In addition to the endorsem*nts mentioned above, Travelers offers the following:
- Personal articles floater: Unlike a jewelry and valuable item endorsem*nt, this is an additional policy if you need higher coverage limits than what your home insurance policy offers for certain items.
- Contents replacement cost: Insures your personal property at its replacement cost value, instead of its actual cash value. Expensive items may require a deductible.
- Special personal property coverage: This add-on expands the personal property arm of your policy to cover damage resulting from any disaster, except those specifically excluded.
- Additional replacement cost protection coverage: Following a covered loss, if your home’s repair costs exceed your dwelling limit, additional replacement cost protection can increase your limit to help curb out-of-pocket expenses.
California city
Travelers avg. annual premium for $300K dwelling
Los Angeles
Travelers avg. annual premium for $300K dwelling
N/A
Anaheim
Travelers avg. annual premium for $300K dwelling
N/A
Riverside
Travelers avg. annual premium for $300K dwelling
N/A
Oakland
Travelers avg. annual premium for $300K dwelling
N/A
Long Beach
Travelers avg. annual premium for $300K dwelling
N/A
Best for bundling with auto insurance
3.7
3.7
Rating: 3.7 stars out of 5 Bankrate scores primarily reflect a weighted rank of industry standard ratings for financial strength and customer experience, in addition to average quoted rates. A secondary assessment of each provider's online and mobile resources and policy management options also contributed to overall ratings. Bankrate Score
Encompass ReviewGet a personalized quote
Avg. premium for $300K dwelling
$264/mo
Avg. premium for $300K dwelling
$3,174/yr
Customer satisfaction
Not rated
Why Encompass made our list:Although Encompass is on the pricier end of premiums in the state, the company offers a plethora of discounts and highly customizable policies. Encompass’ standout money-saving feature is its single deductible option: if you purchase your home and auto insurance policies from Encompass, your claims for both policies could be subject to just a single deductible if the loss occurred from the same event. Home and auto policies from Encompass are available in three coverage tiers — Special, Deluxe and Elite — each with its own list of coverage options and limits.
Who Encompass may be good for:Homeowners looking to house their home and auto insurance policies under one roof may be interested in Encompass. However, the inability to get a quote or file a claim online may deter some shoppers.
Pros
- Highly customizable policies
- Deluxe and Elite tiers offer 200 percent property location limits
- Superior AM Best financial strength rating
Cons
- Quotes are not available online
- High average premiums
- Cannot file a claim online
In terms of customization, you will likely have the most flexibility when you choose between Encompass’s policy tiers versus when you choose individual coverage endorsem*nts. Endorsem*nts vary based on the plan you choose, but the list below can give you a good idea of what’s available from Encompass:
- Ordinance coverage: Increases policy limits to bring your home up to code following a covered loss.
- Replacement cost coverage: Increases your coverage if your home’s rebuild costs exceed your initial policy limits.
- Covered losses for structure and contents: This expands the scope of your home insurance policy to protect your personal possessions from moreperils.
- Lifestyle endorsem*nt:Raises personal liability and property coverage limits in multiple scenarios, like if a family member is in a healthcare facility. It also helps lower deductibles for sports and hobby equipment and can offer higher jewelry coverage limits.
- Identity theft coverage: Provides access to a fraud specialist and up to $20,000 for related expenses.
- Boat and watercraft coverage: Includes underinsured/uninsured boat coverage, replacement cost coverage and personal property coverage for your boat.
California city
Encompass avg. annual premium for $300K dwelling
Los Angeles
Encompass avg. annual premium for $300K dwelling
$5,760
Anaheim
Encompass avg. annual premium for $300K dwelling
$3,800
Riverside
Encompass avg. annual premium for $300K dwelling
$3,514
Oakland
Encompass avg. annual premium for $300K dwelling
$2,682
Long Beach
Encompass avg. annual premium for $300K dwelling
$3,995
Additional California home insurance companies to consider
AAA
AAA Insurance review
Homeowners who are already AAA members
The American Automobile Association, or AAA for short, writes home insurance in California through its subsidiary insurance groups. Depending on your ZIP code, your California home insurance policy could be underwritten by CSAA, Automobile Club of Southern California or AAA Northern California, Montana, Nevada and Utah Insurance Exchange. AAA’s home insurance policies are fairly standard, and may only be worthwhile for those who are already members. It may not make financial sense to join AAA solely for its home insurance policies, but some homeowners may be interested in AAA’s other perks, like its travel discounts and famous roadside assistance.
Mercury
Mercury review
Homeowners on the California FAIR plan
Mercury only writes home insurance policies in 10 states, California being one of them, and may appeal to homeowners who prefer a smaller company. Its difference in conditions, in particular, may appeal to homeowners who have had to resort to the California FAIR plan, an insurance program for homeowners unable to secure coverage in the private market. The difference in conditions endorsem*nt can help fill in coverage gaps found in the FAIR plan, such as rain, theft, water service line and liability coverage.
How Bankrate chose the best home insurance companies in California
California residents have multiple insurers to choose from, several of which offer more affordable premiums for homeowners insurance than the state average. To help you find the best home insurance company for you, we calculated a Bankrate Score to analyze each company across several categories. The rating sections include average annual premiums from Quadrant Information Services, available coverage, discounts and policy features. We also reviewed J.D. Power customer satisfaction ratings to indicate how satisfied customers are with their company’s service and AM Best ratings to assess financial stability. The higher a company ranked in each category, the higher its overall Bankrate Score — 5.0 being the highest possible.
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Cheapest home insurance companies in California
Not every California homeowner will be able to secure a cheap policy, particularly those in a high-risk wildfire area. In fact, homeowners with homes at elevated risk for wildfire damage may struggle to secure any insurance policy, let alone a cheap one. That said, getting familiar with the cheapest home insurance companies in California can be a good starting point if you’re looking for coverage on a budget.
Carrier | Monthly premium for $300k coverage | Annual premium for 300k coverage | Savings vs state avg. for $300k coverage |
---|---|---|---|
USAA | $66 | $793 | - $663 |
Armed Forces | $69 | $833 | - $623 |
Mercury | $72 | $861 | - $595 |
Auto Club | $102 | $1,226 | - $230 |
MAPFRE | $111 | $1,328 | - $128 |
Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.
Rates refreshed as of Sep 2024
Read our full methodology
How Bankrate chose the cheapest home insurance companies in California
Bankrate sources our rate data from Quadrant Information Services. In order to find the best cheap home insurance in California, we started by reviewing the most up-to-date rates available. From there, we narrowed the search to include rates from the larger insurers in the state by market share. Given the volatility of the California home insurance market, we ensured that each provider on our list is still writing policies in the state.
How to get cheap California home insurance
Finding the right California home insurance for your needs is an important part of securing your financial health. Home insurance is designed to help shield your finances from the fallout of unexpected home damage and can help you keep your finances intact if you suffer a loss. To find the best homeowners insurance in California at a price that works for you, you may want to consider these steps:
- Determine what you need. Home insurance needs can vary, so you may want to do some research to determine how much home insurance you need. This can help you avoid overpaying and underinsuring your home. Using an online tool can help. You may also want to make a home inventory of your personal belongings.
- Decide what factors matter most to you. When it comes to shopping for home insurance, finding the cheapest rate may be important to one shopper, while another shopper may need specialty coverage. For another shopper, having access to digital tools may be essential. That’s why it may help to assess what features in a home insurance company are important to you. Once you determine that, you can look for a company that meets those requirements.
- Search for companies. Once you have a list of factors that you’re looking for in a home insurance company, you can start your research. It may be a good idea to find several companies that meet your needs.
- Request quotes. Next, request quotes from the companies that you think might be a good fit. You’ll be able to review coverage offerings, discounts and average rates to determine which is going to ultimately be best for your coverage needs and budget.
- Buy your policy. Once you have a quote that you’d like to proceed with, your agent or a representative from the company will help you buy your home insurance.
Best home insurance discounts in California
Home insurance discounts are an easy way to lower your premium. Most major insurers offer at least a few savings opportunities that might help you get a cheaper rate. Here are some common home insurance discounts in California:
If your home has an automatic sprinkler system to help keep fire damage from spreading, you might save on your home insurance.
Homes that have certain fire-mitigation features or are located in a Firewise or a Shelter-In-Place community may qualify for a home insurance discount.
Some companies offer a discount if your home is built with environmentally friendly materials and certified by certain organizations, including LEED.
Bundling your auto and home insurance with one company is one of the most common (and often most impactful) discounts.
How to save on home insurance policy renewals in California
For better or for worse, your insurance premium is not permanent. If you’re looking to lower your home insurance rate without going through the trouble of changing insurers, there are a couple of steps you can take to secure a more favorable rate:
- Fortify your home against wildfire damage. Wildfire damage is a key concern for most home insurance providers in California, and you could be rewarded with a discount if you take measures to protect your home from wildfire damage.
- Minimize claims. You may not need to file a claim every time your home is damaged. In fact, it may even be cheaper in the long term to avoid it. Many home insurance providers view customers who have filed a claim in the past as more likely to do so in the future and charge higher rates to compensate. To avoid this surcharge, it may be cheaper to pay for certain types and amounts of damage out of pocket if you have the means.
- Raise your deductible — if you can afford it. Opting for a high-deductible home insurance policy may help you get a lower rate. However, be cautious when doing so, and make sure that your deductible is still something you can realistically pay at a moment’s notice without breaking your budget.
- Boost your home’s security. Shoring up your home’s security can do more than just give you added peace of mind, it may also result in added savings. Many insurance providers extend discounts to homeowners who take steps to further secure their homes. Depending on your insurer, this could be as simple as adding a deadbolt, or as involved as a whole-home alarm system.
- Ask about discounts. Home insurance policies typically renew annually, which leaves plenty of time to check for missed discounts. It may be worth setting aside some time with your insurance agent to see what discounts you potentially missed when you first signed up for your policy, and which ones you’ve only recently qualified for.
How much is home insurance in California?
The average cost of homeowners insurance in California for $300,000 in dwelling coverage is $1,456 per year. Although this is below the national average cost of homeowners insurance of $2,285 per year, the insurance premium for every home may be higher or lower than either of these averages depending on the home’s size, age and location, coverage options, and other individual rating factors. When looking for the best homeowners insurance in California, it’s helpful to consider how these factors could affect your final premium.
If you’re wondering why California’s home insurance rates are so low considering how risky the state is, it’s largely because of strict consumer protection laws. California state laws (Proposition 103, in particular) prohibit insurers from raising rates more than 7 percent without approval from the state’s Department of Insurance. As you can imagine, this clogs up the process and results in home insurance rates getting stuck at unsustainably low levels.
While this may seem like good news for homeowners, it is actually one of the many factors that contributed to the market instability plaguing the state.
Insurance company | $150K | $300K | $350K | $450K |
---|---|---|---|---|
USAA | $569 | $793 | $866 | $1,008 |
Chubb | $1,178 | $2,220 | $2,463 | $2,952 |
Auto-Owners | N/A | N/A | N/A | N/A |
Nationwide | $911 | $1,358 | $1,507 | $1,817 |
Encompass | $1,723 | $3,174 | $3,485 | $4,652 |
Home insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.
Rates refreshed as of Sep 2024
Read our full methodology
California homeowners insurance rates by city
When hearing that location can influence home insurance costs, many people’s minds jump to state-by-state cost considerations. While the state you live in plays a role in the cost of your insurance, so does your ZIP code. The interactive map below shows home insurance rates from across the state to help you compare.
- Rohnert Park: $1,042 per year — 28 percent below state average
- Cotati: $1,047 per year — 28 percent below state average
- Santa Clara: $1,055 per year — 28 percent below state average
- Oceano: $1,058 per year — 27 percent below state average
- Los Osos: $1,064 per year — 27 percent below state average
- Topanga: $2,078 per year — 43 percent above state average
- Acton: $2,070 per year — 42 percent above state average
- Lake Hughes: $2,058 per year — 41 percent above state average
- Tarzana: $2,051 per year — 41 percent above state average
- Beverly Hills: $2,047 per year — 41 percent above state average
*Rates are for $300,000 in dwelling coverage.
What does home insurance cover in California?
Before panic-buying every home insurance endorsem*nt your insurer offers, it’s helpful to first understand which disasters are specifically covered in your policy. Once you have a better understanding of what’s covered by your home insurance policy, you can identify potential coverage gaps and purchase more coverage if you need it.
The most common type of home insurance policy is an HO-3. This type of home insurance provides dwelling coverage, other structures coverage and personal property coverage, in addition to liability, medical payments and additional living expenses. Your dwelling and other structures are typically insured on an “open peril” basis, meaning they are protected from everything except what is specifically excluded as outlined in your policy. Your personal property, however, is only protected from the losses, or “perils,” that are named in your policy.
A study from Mercury Insurance identified the most common insurance claims filed by California homeowners. We’ve listed them below by popularity and provided context on how they are already covered by a standard home insurance policy:
- Water damage: Water damage claims made up nearly 57 percent of California’s home insurance claims. Leaky appliances, burst pipes and other sudden and accidental water damage can all be covered by your home insurance policy. Notably, almost all home insurance policies do not cover flood damage.
- Wind: Home insurance can help when a gentle breeze turns not-so-gentle. High winds can damage your roof, siding and other areas of your home, but your home insurance policy could be able to help pay for the repairs.
- Fire: Your dwelling and personal property are financially protected from fire damage, with some key exceptions. Intentionally set fires are not covered by home insurance, and if you live in a wildfire-prone area, your insurer could exclude wildfire damage from your policy.
- Theft: While it’s not a natural disaster, theft can be just as devastating on a personal level. Theft is a named peril on the vast majority of home insurance policies and can cover your dwelling, other structures and personal property up to your specified coverage limits.
Additional home insurance coverage types in California
In a state prone to wildfires, mudslides and earthquakes, asking insurance companies specific questions about what your policy does and does not include is important. For instance, even though California is prone to earthquakes, home insurance companies do not typically include coverage for such incidents. Due to common natural disasters, many insurance experts recommend these extra coverage types for California homeowners:
- Earthquake coverage: Due to its position along the San Andreas Fault, California is one of the most earthquake-prone states in the country. You can usually purchase California earthquake coverage as a separate policy, often sold by the California Earthquake Authority. A private insurance company may also sell earthquake policies.
- Flood insurance: California is considered a flood-prone state due to its valleys and coastal land areas. However, standard home insurance does not include damage caused by floods. Instead, you can buy flood insurance through the National Flood Insurance Program (NFIP) and some private flood insurers.
- Fire insurance: Although coverage for some fires is included in basic homeowners insurance policies, Californians are at an increased risk because of the high probability of wildfires. If you live in an area where finding home insurance coverage is difficult because of the involved risk, you may consider purchasing a separate policy like the FAIR Plan. California FAIR Plan (CFP) recommends only getting coverage through its association as a last resort, but it could offer fire insurance for your home.
- Scheduled personal property: If you own high-value items, like artwork or jewelry, these may not be fully covered by the personal property coverage on your homeowners policy. Some solutions can be to increase your personal property coverage limits or purchase a scheduled personal property endorsem*nt as additional coverage. Because each insurance company may have different guidelines in how it approaches expensive belongings, it can help to speak to an insurance agent to see what the best solution is for you.
Related content:
What you need to know about wildfire insurance in CaliforniaPreviously Read
California earthquake insurancePreviously Read
Understanding California's FAIR planPreviously Read
Common California home insurance problems
California has something to offer for all kinds of homeowners with its buzzing cities, hundreds of miles of coastline, sky-grazing mountain ranges, mild winters and otherworldly desertscapes. While California’s cultural cachet and natural beauty make it a desirable place for many to put down roots, finding the right home insurance policy can be a challenge. Here are a few hurdles homeowners may encounter:
- Dwindling coverage options: In the past year, seven of California’s largest home insurance providers by market share — State Farm, Allstate, Farmers, USAA, Travelers, Nationwide and Chubb — have either stopped accepting new home insurance policies or limited the number of new policies they’re willing to write. Together, these seven insurers wrote more than 34 percent of all home California home insurance policies in 2023, and their departure from the state signals an unstable insurance landscape.
- Difficulties finding a policy: Wildfires can be devastating and lead to some of the most expensive home insurance claims. In 2023, the National Interagency Coordination Center estimated that California lost more than 330,000 acres to wildfires. With that in mind, USAA has tightened its wildfire safety standards to only write policies for homes below a certain risk threshold. While it’s unclear how the new guidelines will affect current policyholders, it certainly doesn’t make it easier for new homeowners to get coverage.
- Strained FAIR plan: The FAIR plan is supported by California’s private home insurers, and if too many homes are on the plan, it could take just one bad wildfire season to wreak havoc. The potential payout required from private insurers in the event of widespread wildfire losses could put them at risk for financial solvency and incentivize them to limit the number of new home insurance policies.
- Natural disasters: California’s natural beauty comes at a steep price. While there’s plenty to enjoy about the great outdoors here, earthquakes, landslides, floods and wildfires pose major threats to homeowners across the state. When shopping for homeowners insurance, California property owners will likely need to consider endorsem*nts or additional policies to be financially protected from Mother Nature’s wrath.
News
Recent updates in the California homeowners insurance market
Due to the increased frequency and devastation of wildfires in California, some insurance providers are limiting the number of new home policies they accept, while others are declining to write any new home coverage in the state. When carriers back out of a state, it likely has implications for all homeowners, so Bankrate's insurance editorial team is closely monitoring this rapidly evolving situation. We will revise Bankrate articles as circ*mstances change so you have the latest and most accurate information to help make sound insurance decisions. Significant recent changes in the California home insurance market include:
- July 12, 2024: Allstate filed for an average home insurance rate increase of 34 percent. If approved by the California Department of Insurance, the price hike would affect upward of 350,000 homeowners.
- July 9, 2024: Guard Insurance filed for withdrawal from the California home insurance market.
- July 1, 2024: State Farm requested an average of 30 percent home insurance rate raise in California, citing major insolvency issues as the motivator behind the request. It also requested a 52 percent average raise for renters and a 36 percent raise for condo owners. The proposed rate increases would take effect in January 2025 and is expected to impact more than 1.2 million policyholders.
- April 18, 2024: Tokio Marine, a Japan-based insurance company, and Trans Pacific Insurance Co. announced they would withdraw from the state of California in July.
- March 25, 2024: Insurance Commissioner Lara unveiled his Sustainable Insurance Strategy, the most comprehensive overhaul of California insurance legislation in 30 years. The Strategy is a multi-pronged approach to incentivize insurers to resume writing new business in California and help stabilize the FAIR Plan.
- Jan. 24, 2024: The Hartford announced it would no longer write new home insurance policies in California beginning February 2024.
- Sept. 21, 2023: California Governor Gavin Newsom issued an executive order calling for “prompt regulatory action” to “improve the efficiency, speed and transparency of the [home insurance] rate approval process.” The order is expected to grant insurers permission to adjust rates that more accurately reflect California’s wildfire risk. While this likely means higher rates for homeowners, the order states that insurers will only be able to do so if they agree to write more policies in high-risk fire areas. New regulations are not expected to be drafted until December 2024.
- Aug. 30, 2023: USAA publicized its plan to limit new California home insurance coverage in March 2024. The insurer plans to raise its wildfire safety standards and only insure homes that pose a lower risk. For now, it is unclear how this decision will affect active USAA policies.
- Aug. 2, 2023: Safeco announced its plans to cancel home insurance policies for homeowners in San Francisco in the Bay Area beginning October 2023.
- July 21, 2023: Smaller insurers AmGUARD and Falls Lake filed withdrawals with the California state insurance regulator. Unlike Farmers, State Farm and Allstate, these two insurers intend to drop policyholders at their renewal dates.
- July 7, 2023: Farmers announced that it will limit new home insurance policies in California to “a level consistent with the volume [it] projected to write each month before recent market changes.” Similar to Allstate and State Farm, Farmers credited catastrophic weather events, rising rebuild costs and inflation for the coverage limit.
- As of May 27, 2023: State Farm stopped accepting new property and casualty applications for homeowners, condominium and commercial policies — new auto insurance policies are still being issued. State Farm cited high reinsurance and rebuild costs in its reason behind the decision, as well as wildfire concerns.
- On Nov. 2, 2022: Allstate quietly paused writing new homeowners and condominium insurance policies in California. California's fourth biggest home insurer cited more frequent wildfire claims and rebuilding costs being too costly to underwrite.
There are still more than 100 available home insurers in California. However, homeowners should be aware of this shift in availability. If you cannot secure insurance for your home, you may want to consider the California Fair Plan, which provides coverage for homes considered high-risk. As of 2021, the FAIR Plain insured 268,231 policies.
Frequently asked questions
Methodology
Bankrate utilizes Quadrant Information Services to analyze September 2024 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates for our base profile are based on the following characteristics and coverage levels:
40 year old
Married male and female homeowners
2016 build year
Primary home
Good credit score
Clean claim history
Dwelling coverage
$300,000
Other structures coverage
$30,000
Personal property coverage
$150,000
Loss of use coverage
$60,000
Liability coverage
$500,000
Medical payment coverage
$1,000
The homeowners also have a $1,000 deductible, a $500 hail deductible and a 2 percent hurricane deductible (or the next closest deductible amounts that are available) where separate deductibles apply.
These are sample rates and should be used for comparative purposes only. Your quotes will differ.
Additional profiles:
- Coverage A, Dwelling: $150,000, $350,000, $450,000, $750,000
- Coverage B, Other Structures: $15,000, $35,000, $45,000, &75,000
- Coverage C, Personal Property: $75,000, $175,000, $225,000, $375,000
- Coverage D, Loss of Use: $30,000, $70,000, $90,000, $150,000
- Coverage E, Liability: $500,000
- Coverage F, Medical Payments: $1,000
Bankrate Scores
Our Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.
Each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. Our scoring model provides a comprehensive view, indicating when companies excel across several key areas and highlighting where they fall short.
5
Rating: 5 stars out of 5
Overall Score
Cost & ratings50%
Coverage & savings30%
Support20%
- Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, average quoted premiums from Quadrant Information Services (if available), as well as any of the latest third-party agency ratings from J.D. Power, AM Best, Demotech and the NAIC, were analyzed.
- Tier 2 (Coverage & savings): We assessed companies’ coverage options and availability to help policyholders find a provider that balances cost with coverage. Additionally, we evaluated each company’s discount options listed on its website.
- Tier 3 (Support): To encompass the many ways a home insurance company can support policyholders, we analyzed avenues of customer accessibility along with community support. This analysis incorporated additional financial strength ratings from and Moody’s and factored a company’s corporate sustainability efforts.
Tier scores are unweighted to show the company's true score in each category out of a possible five points.
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Written by
Natalie Todoroff
Writer, Insurance
Read more from Natalie
Natalie Todoroff is an insurance writer and industry analyst for Bankrate. She is based in San Francisco and holds a personal lines insurance license.