Major Insurance Companies Cease Selling Home Insurance in California Amid Climate Change Concerns

Allstate and State Farm have stopped selling new home insurance policies in California due to soaring wildfire and construction costs and a challenging reinsurance market. The move could worsen the impending insurance unavailability crisis in the state. The FAIR Plan, a state-mandated insurance pool, has seen enrollments surge 70% since 2019 to 272,846 homes in 2022. The average California homeowner’s annual insurance premium is $1,300, compared with more than $2,000 in other states with wildfire risk and $4,000 in hurricane-prone Florida. The insurance crunch is affecting buyers across the state already, even in areas where the wildfire risk is low.