The California homeowners insurance market in 2026
Getting a homeowners policy in California is harder than it was five years ago, mainly because of wildfire losses. The state's largest home insurer stopped taking new applications in 2023, other large carriers closed or limited new business, and many owners in fire-prone areas ended up with the state's insurer of last resort. In late 2026 the picture began to shift, with major carriers filing to reopen.
Insurers that paused new policies
The California Department of Insurance (CDI) reports that State Farm General, the largest homeowners writer in the state, stopped accepting new homeowners applications in May 2023. Allstate, one of the top 10 homeowners writers in California, has not written new residential policies in the state since 2022. CDI does not keep a single live list of which companies are open. Its residential contact list warns that some insurers may not be accepting new business because of underwriting changes, and it advises you to call each company to ask whether it will write your property.
Insurers filing to reopen in 2026
On September 18, 2026, CDI announced that State Farm General had filed to resume new homeowners applications, committing to write homes that meet the Insurance Institute for Business and Home Safety (IBHS) Wildfire Prepared Home Enhanced standard statewide. Allstate filed under the Sustainable Insurance Strategy on August 31. CDI said 12 insurance groups had now filed or received approval under that framework, and that neither company was yet open for new business while its filing is under review.
Growth of the FAIR Plan
When regular insurers say no, owners turn to the California FAIR Plan. The FAIR Plan reported 698,307 policies in force in September 2026, up 157% from September 2022. It sells a limited fire policy, so most owners add a second policy. Our California FAIR Plan guide explains the limits, the October 2026 rate increase and how to apply.
Average homeowners insurance cost in California
The most recent state-by-state average that comes from regulators is from the National Association of Insurance Commissioners (NAIC). For 2022, the average HO-3 homeowners premium in California was $1,492, compared with a U.S. average of $1,569, and California ranked 23rd among states from most to least expensive. California's figure was supplied by CDI. That data is now four years old, and rates have risen since.
Recent rate increases
Rate filings show the direction. In a March 6, 2026 settlement filed by CDI, Consumer Watchdog and State Farm, State Farm's homeowners (non-tenant) rate increase stayed at the 17.0% approved on an interim basis, with condo coverage at about 5.8% and rental dwellings at 32.8%. The FAIR Plan's dwelling rates rose an average of 29.1% from October 15, 2026. Your own premium depends on rebuild cost, roof, construction, claims history and wildfire risk, so treat any average as background only.
What drives your premium
- Rebuild cost, not market value, sets the dwelling limit and much of the price.
- Wildfire risk score. Insurers must tell you your property's wildfire risk score and let you appeal it.
- Roof age and material. A Class A fire-rated roof counts toward wildfire discounts.
- Deductible. A higher deductible lowers the premium but raises your share of a claim.
- Claims history on the home and on you.
How to get homeowners insurance in California
Work through the market in order, from the broadest coverage to the most limited.
Step 1: Call admitted insurers
Admitted insurers are licensed by CDI and use rates it reviews. Start with CDI's residential insurance contact list and ask each company directly whether it will quote your address.
Step 2: Use an independent broker
An independent broker can quote several companies at once and knows which ones are writing in your ZIP code this month. Check any agent's license on CDI's license lookup before you share documents.
Step 3: Consider surplus lines carriers
Surplus lines insurers are not admitted carriers. They can cover homes admitted carriers decline, but their policies vary widely. Read the exclusions and ask how claims are handled.
Step 4: The FAIR Plan plus a DIC policy
If nothing else works, a broker registered with the FAIR Plan places a fire policy there and adds a difference in conditions (DIC) policy for liability, theft and water damage. CDI publishes a list of DIC carriers.
Wildfire mitigation discounts: Safer from Wildfires
Safer from Wildfires is CDI's insurance discount framework. CDI announced on October 17, 2022 that the regulation was state law and that insurers must file new rates that reflect wildfire safety measures, give consumers their wildfire risk score, and allow an appeal of that score. At the time CDI said insurers covering 40% of the residential market offered such discounts, up from 7% in 2019.
Upgrades to the house itself
CDI lists a Class A fire-rated roof (wood shake does not qualify), vents covered with noncombustible metal mesh, soffits that enclose the eaves, and six inches of noncombustible material at the base of exterior walls.
Upgrades around the house
Within 5 feet of the home, CDI calls for an ember-resistant zone, which includes replacing wood fencing attached to the house with metal. Beyond that, the home must comply with state and local defensible space rules.
Community programs
Neighborhood-level action counts too. CDI names Firewise USA communities and Fire Risk Reduction Communities. Ask your HOA or local fire agency whether your area is recognized, then send proof to your insurer.
CDI says every action under Safer from Wildfires qualifies for a discount, but each company sets its own amount. Ask your insurer for its discount schedule in writing. The California wildfire zones guide shows how to look up your property's fire hazard rating.
Earthquake insurance and the California Earthquake Authority
Earthquake coverage is sold separately from your homeowners policy. Most of it comes from the California Earthquake Authority (CEA), which the Legislature created in 1996 as a not-for-profit, publicly managed, privately funded entity after the 1994 Northridge earthquake. CEA says it provides two-thirds of the residential earthquake policies sold in California.
How a CEA homeowners policy works
You buy CEA coverage through your home insurer if it participates in CEA, and you can add it at any time. Deductible choices are 5%, 10%, 15%, 20% or 25%. Homes with a dwelling limit above $1,000,000, and pre-1980 raised-foundation homes without a verified retrofit, can choose only 15%, 20% or 25%. Every policy includes $10,000 for building code upgrades, the first $1,500 of emergency repairs has no deductible, and loss of use coverage never has a deductible.
Worked example: an earthquake deductible
The deductible is a percentage of the dwelling limit. With a dwelling limit of $800,000 and a 15% deductible, you pay the first $800,000 x 0.15 = $120,000 of dwelling damage. At 10%, that drops to $80,000, but the premium rises. Retrofitted older homes can get premium discounts of up to 25%, according to CEA. Our California earthquake insurance guide covers choosing a deductible in more detail.
What mortgage lenders require
If you have a mortgage, your lender sets minimum insurance rules, and most follow Fannie Mae's Selling Guide for one- to four-unit homes.
Lender rule: special form and named perils
Fannie Mae expects a policy written on a "Special" coverage form or equivalent, covering at least fire or lightning, explosion, windstorm, hail, smoke, aircraft, vehicles and riot or civil commotion. Coverage must be on a replacement cost basis, except that roofs need not be.
Lender rule: the 5% deductible cap
The maximum deductible is 5% of the coverage amount, per peril. On $600,000 of dwelling coverage, that is $600,000 x 0.05 = $30,000 at most. Earthquake insurance is not part of these rules, so whether you buy it is usually your choice. Ask your lender for its written requirements before you shop, because some lenders add their own.
Tips for insuring a home you are buying
Get quotes before you remove contingencies
Start the insurance search the day your offer is accepted. Ask the seller who insures the home now and what it costs. If only the FAIR Plan will quote, price the fire policy and the DIC policy together and add both to your budget. Our California closing costs guide shows where the first year's premium fits.
Ask about claims history and the roof
Prior claims on the property can affect your quotes. Ask the seller for any claims on the home and for the age and material of the roof, and have your inspector note the roof's condition. First-time buyers can find more steps in our first-time homebuyer guide.
Common homeowners insurance mistakes
- Setting the dwelling limit at the sale price. Land is not insured. Base the limit on a rebuild estimate.
- Assuming earthquake damage is covered. It is a separate policy.
- Not asking for your wildfire risk score. You have the right to see it and appeal it.
- Letting a non-renewal run out. Start shopping the day the notice arrives.
- Not reviewing coverage after upgrades. Tell your insurer about a new roof or vents to claim the discount.