California is home to one of the largest insurance markets in the world, but it can also be one of the most challenging states for homeowners searching for coverage. Although Californians pay $1,014 annually for $250,000 in dwelling coverage — less than the national average — finding homeowners insurance has become an increasingly difficult task as many insurers have dropped coverage. The state has faced historic losses in recent years due to wildfires. Just last year, in 2020, there were nearly 10,000 wildfire occurrences in California, which damaged more than 4 million acres of land and impacted 10,488 homes and structures. Comparatively, in 2019, wildfires burned roughly 4.7 million acres and displaced roughly 200,000 people, according to the Insurance Information Institute.
With many insurers choosing to hike rates or no longer offer policies in California, there may be limited options for consumers. And unlike natural disasters that occur in specific locations, California’s dry climate and frequent droughts mean that millions of homes across the state are consistently at-risk of fire damage among other perils.
To help keep your dwelling more financially protected against the state’s hazardous conditions, Bankrate has pulled together a list of the best home insurance companies currently offering policies in California.
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. Here are the top five options based on average annual premiums, 2020 J.D. Power customer satisfaction ratings and financial strength:
|Home insurance company||Average annual premium for $250K dwelling||J.D. Power customer satisfaction score||AM Best Rating|
|CSAA Insurance Group||$909||825/1,000||A (Excellent)|
|State Farm||$732||829/1000||A++ (Superior)|
|The Hartford||$1,307||832/1000||A+ (Superior)|
*Due to membership eligibility restrictions, USAA is considered rank-ineligible by J.D. Power.
Allstate is tied with State Farm in J.D. Power ratings for overall customer satisfaction across several categories. Allstate offers a broad list of coverage options for homeowners in California to choose from. From the standard coverage options like dwelling coverage, liability protection, personal property and guest medical protection, to the not-so-common options like flood insurance coverage and yard and garden coverage and more. Allstate also received an A+ Superior rating from the Better Business Bureau for promptly addressing customer complaints.
Learn more: Allstate Insurance review
CSAA Insurance Group
CSAA Insurance Group is an AAA insurer. The insurance company offers affordable premiums with an average annual premium of $909 for a $250Kk dwelling. The insurer rated above average in customer satisfaction, with a J.D. Power score of 825 out of 1,000 points. CSAA Insurance Group was given an A (Excellent) rating from AM Best. The downside of CSAA Insurance Group is that it is only accessible to homeowners in Alaska, Arizona, Northern California, Nevada, Montana, Utah and Wyoming.
Learn more: AAA Insurance review
State Farm earned 829 out of 1,000 points from J.D. Power for overall satisfaction and in several other categories, including policy offerings, billing and interaction. The company writes more policies in California than any other on our list, according to the Insurance Information Institute. In addition to standard coverages for your dwelling and personal property, State Farm also offers pet insurance through Trupanion, which provides unlimited medical insurance limits for the duration of your policy.
Learn more: State Farm Insurance review
The Hartford is an AARP homeowners insurance program. With a J.D. Power Rating of 832 out of 1,000 points, customers are generally satisfied with The Hartford’s homeowners insurance offerings and services. Homeowners in California who opt for The Hartford can enjoy selecting coverages that fit their homeowners insurance policy needs. The drawback is that The Hartford is only available to AARP members. However, the AARP membership enables you to receive more benefits and savings on homeowners insurance.
Learn more: The Hartford Insurance review
USAA earned 889 out of 1,000 J.D. Power points in ratings for overall satisfaction, making it one of the top providers in the country that writes policies in California. However, because it is only available for members of the military and their immediate families, it is not eligible for official rankings by J.D. Power. For those that are eligible to become USAA members, it is often one of the most affordable providers. It also has unique options that are beneficial to military members, like coverage for uniforms damaged in a covered loss.
Learn more: USAA Insurance review
Additional companies to consider
Kin Insurance is an insurtech startup founded in 2016 and headquartered in Chicago. Its mission is to offer affordable cover to homeowners and reports that customers save an average of $500.
With Kin, the average insurance cost in California is $1,188 per year. With Kin’s HO-3 policies, California homeowners will receive coverage on belongings, home, liability, medical payments, and more. Additionally, standard coverage includes wildfire insurance for damage caused to your home’s structures, trees and plants and expenses for fire department services.
Learn more: Kin Insurance review
Cheapest homeowners insurance in California
Due to California’s upward trend of wildfire occurrences, many home insurers have decided to either drop coverage in the state or raise premiums to account for the heightened risk. Because of this, Californians may find it difficult to find affordable coverage for their homes.
There are still many major providers who provide competitive home insurance premiums within the state. The table below features the cheapest homeowners insurance rates from the nation’s most popular providers, based on market share.
|Company||Average annual premium|
Each of these companies offer the standard coverages any homeowner might expect and may even have additional options that are worthy of consideration. While USAA is only available to military members and veterans, all of the providers offer coverage nationwide.
Several factors will impact your final home insurance rate, such as the age and size of your home, but these companies may be a good starting point for quote comparison. When deciding your coverage, experts recommend you consider limits and available endorsements offered by each provider to ensure that your property is financially protected.
Home insurance in California
Californians maintain a 54.8% homeownership rate and given the hazards posed by natural disasters and other geographical risks, several unique considerations commonly impact home insurance decisions.
Common causes of loss in California
Some of the risks most pertinent in California include wildfires, earthquakes, floods and mudslides, with wildfires being among the most pressing risk in recent years. The 10 costliest wildfires to occur in the United States all took place in California, according to the Insurance Information Institute.
The recent years have been especially catastrophic for California, due to these fires:
- Camp Fire: November 2018, $8.7 to $10.7 million in losses
- Tubbs Fire: October 2017, $7.8 to $10.1 million in losses
- Atlas Fire: October 2017, $3.1 to $5.1 million in losses
- Thomas Fire: December 2017, $2.6 to $4.7 million in losses
Home insurance coverage options in California
In a state prone to wildfires, mudslides and earthquakes, it is important to ask providers specific questions about what your policy does and does not include.
For instance, even though California is prone to earthquakes, home insurance companies do not typically include coverage for such incidents, according to the California Department of Insurance. So if your home was completely destroyed in a massive earthquake, insurance would not cover the repairs in most cases. Due to common natural disasters, recommended coverages for California homeowners often include:
- Flood insurance: California is considered a flood-prone state due its valleys and coastal land areas. However, most homeowners insurance policies will not include damage caused by floods. Instead, flood insurance can be purchased through the National Flood Insurance Program (NFIP). As of 2019, California had more than 34,000 NFIP flood insurance policies written.
- Fire insurance: Although coverage for some fires are 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 want to consider purchasing a separate policy like the FAIR Plan. California FAIR Plan (CFP), based in Los Angeles, recommends only getting coverage through its association as a last resort, but it could offer fire insurance for your home.
Frequently asked questions
What is the cheapest homeowners insurance in California?
There are several large providers in California offering cheaper homeowners insurance policies (compared to the state average), which include all of the standard protections such as coverage for dwellings, personal property, other structures and liability. To find the most affordable policy for your situation, compare quotes from multiple providers based on the coverages you need and see how adding discounts, like bundling, will affect your premium.
How do I get homeowners insurance in California?
The California Department of Insurance recommends contacting agents and brokers located near your home. You can also try using the department’s Residential Insurance Company Contact List. As a first step, you could collect homeowners insurance quotes from different insurer’s online websites before proceeding with speaking to an agent.
What is the California FAIR Plan?
Due to the threat of wildfires in California, many companies have stopped offering coverage in the state. The FAIR Plan provides last resort insurance coverage to homeowners who are unable to obtain coverage. A Los Angeles-based association, the FAIR Plan is made up of insurers who are authorized to offer basic property insurance in California.
Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on 40-year-old male and female homeowners with a clean claim history, good credit and the following coverage limits:
- Coverage A, Dwelling: $250,000
- Coverage B, Other Structures: $25,000
- Coverage C, Personal Property: $125,000
- Coverage D, Loss of Use: $50,000
- Coverage E, Liability: $300,000
- Coverage F, Medical Payments: $1,000
The homeowners also have a $1,000 deductible and a separate wind and hail deductible (if required).
These are sample rates and should be used for comparative purposes only. Your quotes will differ.