California has approved a 34% increase in homeowners insurance premiums, affecting more than 350,000 policyholders. State Farm is seeking a 30% increase but that request is still pending.
Allstate is the sixth-largest insurer in the state. It stopped writing new California homeowners insurance policies in November 2022, but as part of the latest increase it agreed not to make any more mass nonrewals through the end of January.
"This home insurance rate approval allows us to continue protecting our existing customers as we work with the California Department of Insurance to improve coverage availability and create a more viable and sustainable homeowners insurance market for consumers in the state," Allstate said in a statement.
The company cited higher home values and repair costs and more severe weather as causes of the rate increase.
Itg's not alone. Many California home insurers have pulled back from the market and sought rate increases in recent years, citing the rising severity of wildfires and other factors.
The rising costs and nonrenewals have created a crisis in California's housing market. Homeowners are finding it hard to sell properties that lack insurance or have extremely high premiums.
The problem's not confined to California. Homeowners in other sunbelt states that are prone to hurricanes and other natural disasters are also facing skyrocketing premiums and nonrenewals.
